40 Finance Monthly. Bank i ng & F i nanc i a l Se r v i ce s influence your life insurance policy and the cost thereof. At first glance, it’s good to consider what your personal insurance needs might be. This might consist of several things, including your family dynamic, financial position, current debt, and any expenses you might have as a family unit. Typically, if you are someone who makes up a large portion of the monthly family income, you will need to answer whether your life insurance coverage will help meet your family’s financial needs in case of a sudden emergency. Before taking out a policy, ensure you undergo a thorough assessment or evaluation, as this will help you determine the type of policy you might require. During the evaluation process, you will be required to deliver or provide as much personal information to ensure you are provided with the best policy options available for you and your family. Evaluate the different types of policies Typically, insurers will provide consumers with an option of different life insurance policies, with the most common two types being either term-based or permanent life insurance. It’s best that you first evaluate each before making a final decision, as this will impact how much your monthly premium will be, and what is included in the policy. Term-based policy A term life insurance policy will only cover you for a predetermined period of time. This may range, depending on your personal needs, and can be anything from ten, fifteen, twenty, or even thirty years. Younger consumers often start with term-based life insurance policies, given the fact that their needs and financial position might be different than older and more mature consumers. Permanent policy The second option would be to take out a permanent life insurance policy, which will cover you for your entire life. Although this provides better and more thorough risk management, premiums, or monthly payment, will typically be higher. Although you may end up paying more for permanent life insurance, there tend to be two components included in the policy that helps cover life-threatening events and life savings or investments. Instead of only covering you in case of sudden death and illness, these policies will also help grow your savings over time. Understand how personal factors can influence your policy Life insurance may not be priced the same across the board, and usually, insurers will offer a base premium, and only after an assessment, the final premium cost will be determined. Depending on what your personal condition might be, the premium you pay can either be higher or lower, so you should undergo a full and thorough assessment with several providers. What can affect your premium rate: • Physical health or pre-existing health conditions. • The age from when you take out the policy. • Your current occupation and financial position. • Any criminal records or legal findings. • The type of policy term, either permanent or term-based. If you’re the sole provider for your family, taking out life insurance may be a stressful task, as your personal history may affect whether you are approved or denied. More so, there are instances where personal factors can help you get the best possible policy rate, but if sudden changes take place, such as a change of job, or problems with your health occur your policy rates may change. of American adults had neither employer-backed nor individual life insurance. 46%
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