Life Insurance - 10 Step Guide
Life insurance has many benefits for people who opt for this option, and it can play a massive part in the wellbeing of people whom you consider dear. Selecting the right option for life insurance can be an arduous task because it has some many details involved that can sway your decision from one opportunity to the other. This article will provide you with a step by step guide for choosing the best life insurance policy for yourself.
Decide why you need life insurance
The first thing you need to decide is the reason you need life insurance for. It would benefit your family members if you were the primary earner of the family. It can also help them to deal with any financial crisis that comes their way in your absence. Life insurance is also beneficial for paying off your debts such as a mortgage, car loans, and credit cards and also leaving an inheritance for your loved ones. In addition, don’t forget to do your research and include the best option for your funeral expenses, which can be very high, but the cost of insurance can be surprisingly affordable, so you will really dig this option to secure your family at what is a really stressful time. If you haven’t opted for any secure option your property or even home may be sold to pay off any outstanding financial issues. If any of these reasons are valid for you, you may need to choose a life insurance policy.
Decide how much coverage you require
Life insurance cover can be flexible, from a couple of thousand pounds to several hundred thousand pounds, but that depends on your financial situation and family expectations. Usually, it is enough to cover the basic costs, including bills and mortgages every month if you go for a more straightforward option. The best thing is that you don’t even have to pay too much, depending on your age, you may end up paying as low as £5 a month but on average that value is somewhere in the range of £20 to £30. If you have any outstanding debts or any other issues, then you may want to go for a higher premium. UK broker Reassured have built a life insurance calculator which may help you establish the level of cover you need.
Choose the right option
There are two main types of insurance policies available in the UK, and they are term insurance and permanent life insurance. Just as the name suggests, term insurance lasts for a specific period during your lifetime and covers everything that you opt for until it lasts. On the other hand, permanent life insurance continues until you are alive and usually costs much more than term insurance. It is up to you to decide if you require protection for a minimum or a maximum period.
Read the fine details
While every insurance policy is tailored to look perfect for everyone, the key is in the fine details that are not talked about much until you ask. Make sure you know about any hidden costs, the billing processes, the criteria for benefits, the things involved or excluded and the update in the policy. There are many things that you only realise after you have signed the deal, so take your time.
Compare and eliminate
Select a few possible options that you think are right for you, review the terms again from different providers and get online quotes from the companies. If you are still confused as to which option to book an appointment. Ask as many questions as you can when you have a face to face meeting with the insurance provider. Be clear about all the things that matter to you and then eliminate that don’t fulfil your criteria.
Collect all the documents
Most insurance companies will ask for a medical report so that they can evaluate your current health condition as it forms the basis of any life insurance policy. If they need a check-up regarding something important, they will mention it clearly. You will also have to provide your financial statements or salary slips along with the proof of your age and that of any other individuals involved.
Apply for the life insurance policy
Once you have collected all the documents that were required and had the data available to fill the life insurance form, you can proceed with the application process. If you are facing any difficulty with that, there are different agents available that help with the filling of the forms and applying correctly. Understanding everything beforehand and preparing for it by doing your medical, collecting information can help make the process smoother.
Wait for the decision
Once you have submitted your application along with all the requirements now is the time to wait, this duration is known as undertaking. The provider reviews your application, see all the details and the final decision is taken by the insurance provider based on the information they have and it does not take longer than three to four weeks under exceptional circumstances. If you have provided everything, then it may even be approved within ten days.
Submit the down payment
If the insurance company accepts your application, they will issue you a policy booklet that will have everything about the company and the policy you have opted for. It will also contain details of the payment procedure, and how frequently you are supposed to make a deposit depending on the option, you selected. Once you have made the down payment and it is received by the company your life insurance begins immediately.
Review your policy
The option of making changes to your life insurance policy based on your situation is always possible. It is possible that you have a new family member now or that your financial condition had changed from when you started the life insurance. Make sure to decide on a specific time frame after which you regularly review your package to make sure it meets all your requirements.
All in all, you have to evaluate everything involved with a life insurance policy carefully; it is especially important to read the fine details about any deal so that you are aware of all the conditions. It also makes sense to consult an advisor or get as much information as possible from them as possible to clear any ambiguities that you have in your mind.