Wednesday, November 28, 2012

Top Questions for Your Life Insurance Agent

Many people would assume that looking into buying life insurance is something that is done once a person has reached a certain age group, like senior citizens. However, anyone really can buy a life insurance plan at any age as an adult. Some people ask why they would need it if they are in good health. Others have whole hosts of other questions. Life insurance is always good to have, because if all conditions are met, it basically acts as a benefit to surviving family members.

An agent consults with people and often has the answers to most questions that people ask about potential coverage and costs. What follows are some of the top things you should ask your life insurance agent about.

How much coverage is needed?

This is one of the first questions asked and it is a very good one. How much coverage a person gets will determine the premiums. The premiums are what are paid every month to keep the policy in effect until the person's life has come to an end. Normally the amount of coverage needed is based on two sets of calculations and can really be answered by yourself, although the agent can help you with this. The calculations that go into this answer are: The amount it will take to pay off all outstanding debts, and the amount needed by the surviving family members to maintain a standard of living.

What sort of policy should be purchased?

Most companies offer several types of plans, others may specialize in just one. Your agent will help you determine, based on your needs, whether you should have term, whole, or variable. Some plans allow you to borrow from your benefit while still living.

Who is the policy under?

This is very important as you need to know who your policy is under, and that company should be researched with regards to its reputation and its strength, and more importantly, will they have the money to pay up once it comes time for the benefits to be paid?

What are the restrictions/exclusions?

Somewhere in the policy will be restrictions or exclusions. Certain modes of death may not be covered, so it is important to know what the limitations are. If you die in a manner that is excluded under the policy, then it is likely your family will get nothing.

Is there a medical exam?

Another very important question here, because sometimes if certain medical conditions exist, coverage may not be attainable or limited further than you want. It is worthy to note that some policies can be had without a medical exam, but obviously they will cost more than the policies that do require medical exams.

Will premiums rise with age?

Many policies have set premiums, so as one ages and gets closer to death, the cost of maintaining the policy does not rise with it. However, if a policy is not renewed and you are older, getting a policy again will likely cost more.

Is the policy renewable?

This relates directly with the above question. Most are renewable, but you need to make sure that you know the renewal deadline so you don't have to re-purchase a policy and risk having a higher premium since you've aged since the first policy was purchased.

These are not all the questions that should be asked, but they are some of the top things you should ask your life insurance agent about. Make sure to read everything and get all your questions answered before signing on the dotted line.

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