Is Life Insurance Worth It?
Most Americans understand that their family could benefit from having life insurance, but very few fully understand how to get the most value from their life insurance policy. When considering life insurance, follow the tips below to make your policy worth it for your family.
- Be honest. Lying about your age, health conditions, lifestyle or anything else you're asked about during the application process is a big mistake. Although you may get lower premiums, the insurance company may not pay out the full death benefit if they discover you mislead them. Insurance companies will do research before they pay your family after your passing, so it's best to be honest up front. If you provide false information on your application, your policy could be worthless.
- Understand the terms of the contract. When you're talking with your insurance agent, be sure to ask questions about any waiting periods that may be in the policy. Some policies will not pay out the full death benefit if you pass away within the first few months or years after the policy becomes active. In some cases, your family would be paid in full if you died the next day, while others would give you just the return of premiums and a percentage of the death benefit if you die within the first two policy years.
- Know what you need the coverage for. When it comes to choosing the correct amount of coverage, the first thing you need to know is how much your family would need if you passed away. If you provide services or an income to your family, have a mortgage, car payment, student loans or other debt, your family would need your life insurance to cover all of it in addition to your funeral expenses. However, if you're retired and have little to no debt, you won't need as much coverage. If you don't know what your policy will cover, then you could have too little or much coverage.
- Consider the tax benefits. If your main goal is to cover your funeral expenses and leave behind an inheritance for your loved ones, you should consider the tax benefits of life insurance. Rather than leaving your money in the stock market or a savings account that doesn't gain much interest, life insurance can keep your money safe and help your family avoid taxes, legal fees and other expenses. Talk with a tax professional or your insurance agent to determine how much you should put into your life insurance policy to get the best tax breaks for your family.
Although getting the best deal on life insurance can seem overwhelming, the life insurance professionals at NAA Insurance can make it simple and easy for you. Just tell us what your family will need when you pass away, and we'll give you several different options to choose from. We'll listen to your needs, thoroughly explain your options and help you make the best decision for you family.
If you'd like to find out about your life insurance options or review your current policy, browse this website and fill out the form at the bottom of the page. We'll have a licensed insurance agent contact you as soon as possible so you can make the most of your coverage.