Every family man knows at some point that it is the time in his life that he must start looking around for the right insurance policy. In your 20s, you may not feel the need to take a life insurance policy for you may be studying or have got your first job and may consider buying a car or a house a bigger priority. Once you get married and start a family, the realization will come that you need to get affordable life insurance to protect your family from a financial disaster in case of your untimely demise.
Those who have mortgages need to especially consider taking an instant term life insurance for in case of your untimely demise, your family maybe unable to pay the mortgage and have to lose the family home. This is where taking an instant term life insurance is a smart move. These policies have a lower premium than permanent insurance policies as they do not include a savings component. A person looking to take an instant term life insurance must know the exact term they should take the policy for.
For example, if a man in his 30s takes an instant term life insurance for 10 years, it is extremely likely that he will outlive that policy and will end up with no benefit whatsoever. This is the main drawback of instant term life insurance - if you outlive the term by even a day, your family will receive no benefit. On the other hand, if you die within the term, your family will receive the entire insurance money which they can then use to pay up outstanding debts. This is why for a person in his 30s, should ideally take coverage for at least 30-40 years.
On the other hand, if you still insist on taking instant term life insurance for a 10 year period, then take the renewable option so that you can continue the policy even after it expires. Now, this could be a big mistake for, the older you are, the higher will be the insurance rates. So if an individual in his 30s pays a monthly premium of say $47, at the age of 40 when he renews the policy, he could end up paying around $95 which is almost double.
Those looking for affordable life insurance need to adopt the following strategies:
• Stay healthy
• Don't have dangerous hobbies or jobs
• Undergo medical tests
• Take long term coverage
• Compare rates and terms before selecting a policy
Those with a healthy lifestyle - no smoking or drinking will definitely pay lower insurance rates. A 40 year old smoker may end up paying more than double what a non smoker will do.
Another reason why insurance premiums will sky rocket is if you have dangerous hobbies like sky diving or mountaineering or risky jobs like a firefighter or a miner. While it is easy to give up dangerous hobbies, it may not be so easy to do the same for risky jobs. Hence, those with risky jobs could take up insurance offered at the place of employment rather than looking for one from a private insurance provider. Most employers have group insurance schemes that will be extremely affordable life insurance.
Those with healthy lifestyles will not be afraid to undergo medical tests. Do not give 'being too busy' as an excuse to avoid medical tests. In order to be eligible for truly affordable life insurance, you need to go through a complete medical exam. Also, most top insurance companies do not have a 'no exam' policy for they will not wish to undertake the risk of insuring unhealthy people who are highly likely to die within the insurance period. Sensible people will buy instant term life insurance for the maximum tenure on offer. This will mean that the premiums will not increase throughout the policy even if you develop a terminal illness during that time.
Finally, before taking any form of insurance, it is important to know the amount of coverage you need and to compare rates and terms and conditions of different insurance companies before selecting a policy. Seek the help of insurance advisors who can direct you to the right policy and explain the various terms and conditions which are very often confusing to the novice. Above all make sure that whatever the policy you take, that you will be able to comfortably pay the premiums without defaulting.