Life Insurance – Some Facts That Need Prior Consideration

Even today, a large percentage of American population lives without life insurance coverage. Indeed, many of them do not want even to think about it because to them a life insurance policy implies premature death, sorrow and bereavement. However, it need not necessarily be true. 
Buy a suitable life insurance policy to live in peace. Being covered means that if indeed you die a premature death, your family will not face any financial problem. Indeed, an ideal life insurance policy should replace the income of the main breadwinner incase of his premature death so that all the responsibilities that were earlier covered by his income is now covered by it. Moreover, if there is any newer challenge to meet, the coverage amount should be able to cover that also.
 Anyway, it's very easy to get an affordable life insurance for your family but low monthly premium shouldn't be your key factor in deciding upon the policy. A good life insurance program will not only replace the loss of income that occurs if the insured person dies but also provide money to cover the new costs. And these cash benefits should be available to the beneficiaries with out any restriction of use.  On the other spectrum are some people who either are over insured or buy insurance products even though they do not need it. Therefore, before you buy a life insurance policy, make sure you need it. Since it replaces an income, you do not need it if you do not have an income or if you have enough savings to take care of your insurance requirement. Then, if you have no family or more precisely, if there is no one who will suffer pecuniary hardship on your premature death, do not buy an insurance policy. Instead, invest the money in a suitable saving option.  Basically, there are various types of life insurance. And deciding upon the type of the policy involves a series of decisions like naming a beneficiary, choosing a type of policy, the range of coverage it provides etc.  Types of Life Insurance: • Term Life Insurance • Permanent (Whole) Life Insurance
Just as the name suggests, Term life Insurance provides coverage for a  specific period of time or term that we opt for like 5,10,or 20 years. When the term ends, we have the option of renewing the policy. Instant Term Life Insurance pays a lump sum amount of single benefit at the time of death. It's also called temporary insurance. The term policy pays cash only if death occurs during the term of the policy. If the term ends without the death of the insured person and if it's not renewed, then the policy automatically ceases. Term insurance is very simple and straight. It's very affordable and beneficial for people with young children, those who plan to buy a home, or those with debt to payoff. Term insurance can be renewed when the term ends and also can be converted to whole life or permanent insurance at any point of time. Its very flexible according to the needs of the insurer.   All other term life insurance policies are generally very low priced and are mainly bought to cover financial responsibilities such as dependent care, mortgages and loans, children's education etc. However, because no benefit can be claimed if you outlive the term even by a day, it is imperative that you should decide on the duration term very carefully. Another important point that you need to ponder about is what kind of term life you should buy. These are quite a few of them. Following are few of them:• Annually renewable term life• Level term life valid for 5/10/15/20/25/30 years• Decreasing term life with level premium but decreasing face value• Convertible term life that can be converted into permanent life later on Permanent (Whole) Life Insurance is a case where there is no specific term or   period by which the policy expires. Its life long for the policy holder. Upon   the death of the policyholder, the death benefit is paid to the  beneficiaries. And in this type of policy, the cash value accumulates over time and when we cancel the policy after sometime, and then the insurance company is responsible to pay the cash value to the policy holder. It's upon us as to take which type of policy for our loved ones. In the case of whole insurance, the amount of premium to be paid monthly will be a bit more than that of term insurance. So people having a better financial stability can think of opting for whole insurance.