Few consumer products are the object of a love/hate relationship as life insurance. The thought of buying life insurance is not something that most physicians relish, yet, if it is done right, it can provide the greatest peace-of-mind a person can have. The key is to do it right. Following this helpful life insurance advice may ease the burden and have you feeling good about your purchase right from the beginning.
Buy it for the Right Reasons
Most people don’t like to be sold life insurance, but they will buy it if they recognize the real reasons for buying it. It’s important not to think of life insurance as simply a death benefit. It’s much more than that. Life insurance is a family’s ultimate security blanket. It could mean that the family is able to stay in their home. It can ensure that the kids still receive a quality education. It means that a non-working spouse has time to comfortably re-enter the workforce. It provides the financial security that every family needs.
Sometimes the only way to achieve that focus is to step outside of your home, look back at your family, and imagine what it would be like for them if you were never to walk through the front door again. As unpleasant as that may be, solving for that possibility with life insurance can bring a tremendous amount of comfort.
Don’t Guess Your Need for Life Insurance
With so much at stake for you and your family, it doesn’t make sense to simply guess at the amount of life insurance they will need. Simply formulas, such as a multiple of annual earnings, are likely to fall short of the actual need. It’s also not very comforting if you feel you own too much life insurance. By taking a little extra time up front, you can arrive at an amount that you and your family know will provide the right amount of financial security. Several factors need to be considered:
- current assets and current liabilities
- earning capabilities of the surviving spouse
- income available from other sources
- future income needs of dependents at all stages of life
- important family obligations such as college education
- protection of a family owned business
Most financial advisors and life insurance agents can provide you with a no obligation analysis which can crunch the numbers based on a few different scenarios. You can also access a free life insurance calculator online.
Find a Reliable Agent
Having an experienced and reliable agent or broker can be invaluable when you are trying to wade through the complexities and confusion of the many different types of policies. A good insurance professional will know how to help you better understand your particular need and match you with the most suitable product. They can also help you navigate through the underwriting process and find the best offer for your underwriting class. A good agent or broker can save you time and money in the long run.
It may be best to work with an insurance broker who has access to many companies’ products. It’s recommended that you check with people you trust to get some referrals and then interview several brokers until you find the one you can work with.
Minimize Your Costs
There are plenty of ways to keep your costs down starting with making sure you buy the right amount to start. If you end up buying more policies in the future, it will increase the overall cost of your life insurance. Plus, many companies offer breaks based on the amount of the face value. So, if you’re need is somewhere around $900,000 for a face value, be sure to check the rates for a policy with a $1 million face amount – it could be less expensive.
The life insurance purchase doesn’t have to be a dreaded event, and it is certainly not a necessary evil when you consider that it is the ultimate expression of your love for your family. By following this helpful life insurance advice, making sound decisions based on your actual need and situation can actually make the process easy and very fulfilling.