Posted: 13 Oct '11
How to Choose Your Life Insurance?
The life insurance business seems complicated with every company having 4 or 5 different life insurance products and many different disability and critical illness policies.
Things get more complicated when companies have names for each life insurance product even though many policies with different names work in much the same way.
Adding to the complexity life insurance is set up to last from 1 to 60 years. The question is, “how do you even start to make the right decision?”
5 points to consider
- You want to own a private disability insurance contract for as much monthly benefit as your current income qualifies.
- Get a large amount of Term Life Insurance because the premiums are low and you can always reduce the death benefit in the future. When you look out over your life time unless you’re buying the term life insurance to cover a particular loan repayment how can you make a decision on the amount of life insurance you will need to cover you for 60 years? The larger your death benefit the better protected you’ll be.
- You need to give yourself as much flexibility as you can so you can make changes to the contract even if your health changes and you become less insurable or not insurable at all in the future.
- Consider office over head insurance if you’re responsible for office expenses should you suffer a disability. Office over head insurance is the only insurance were the premiums are tax deductible.
- After your disability insurance is set up and you have a large term life insurance death benefit then consider Critical illness.
Always look for flexibility, the future is just too unpredictable and to infinite.