Life

Ways to Procure a Cheaper Life Insurance Plan

(Credit: Unsplash) WAYS TO PROCURE A CHEAPER LIFE INSURANCE PLAN
June 23
6:30 PM 2020

Life insurance is an important product that offers peace of mind to individuals, knowing that their relatives or dependants will be fine should they pass away. With a life insurance policy, you have no need to worry about the welfare of your spouse, children, relatives, and other dependents, as they will be well taken care of should you kick the bucket. Nothing is as terrible as losing a loved one, but it becomes a downward-spiral when there is no financial support to fall back on, especially if the deceased happens to be the financial pillar of the family. On the other hand, if the deceased have a life insurance policy, it will help support the relatives financially with the funeral costs and other expenses along the line.

What Is A Life Insurance Policy?

A life insurance policy is a type of policy where the relatives of a deceased policyholder are paid a lump sum of money to cater for several needs, including taking care of the younger ones, paying off a mortgage or rent, or offsetting a car loan. Life insurance offers the policyholder's dependent peace of mind and financial security. Many people are taking advantage of this product to secure the future of their loved ones. This is also an ideal way to invest into the lives of your children as well.

How To Compare Life Insurance Policy

You can easily find cheaper life insurance policies from various insurance companies with the aid of an insurance policy expert. All you need is to request for a quote, fill in a short form detailing your personal information and type of insurance policy, and submit. A broker will get in touch with you shortly to discuss your options. It is as simple as that.

Types Life Insurance Policies

There are two types of life insurance policies you can avail yourself of: level term life insurance and decreasing term life insurance.

Level Term Life Insurance:

This type of insurance policy is ideal for policyholders who intend to secure the finances of their beneficiaries for a long period until they are able to stand on their own financially. When procuring the insurance policy, the policyholder specifies the term length of the insurance policy, which can range from 5 to 50 years, although the typical duration falls between 10 and 25 years. The pay-out on this policy is fixed, regardless of how far the policyholder gets into the term. This policy is more expensive than the decreasing term life insurance.

Decreasing Term Life Insurance:

This type of life insurance policy is a cheaper alternative to the level term life insurance; although it has a different structure and application. The insurance policy helps dependents of a deceased policyholder pay off debts, an example being a mortgage. Insurance policyholders on this term also specify the term length - just as it is with the level term life insurance. However, in this case, the payout decreases as the term progresses, signifying the amount of debt left unpaid. This makes the policy cheaper than its counterpart.

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