ADMINISTRATIVE PROCEDURES
Death is a finality that no one is ever prepared for, especially not the dependents of a breadwinner. It finds them unprepared for life without you, but you can make smarter choices for their sake. Life insurance allows them to enjoy a smoother experience even after your transition. If you are curious about life insurance, here are a few details you might want to know about it.
What is Life Insurance, and Why Might You Need One
A life insurance policy is an agreement between you and an insurance company to pay for a premium given to your loved ones after your demise. Your family will receive a death benefit after your transition in a lump sum. This money is handy in ensuring they do not have difficulty adjusting to your absence, especially regarding financial matters.
Anyone can get a life insurance policy, but you must have the financial muscle to disburse monthly payments as agreed in your contract. If you aren’t sure how much you have to spare, you should work with a financial advisor to help streamline the process and find available resources you can utilize.
The primary reason for paying for life insurance is to have financial security. Most people take life insurance to safeguard their families if they die untimely. However, you can be a beneficiary of this premium under certain circumstances. Life insurance can be an egg basket that saves you when you have minimal options to pick from when you need financial assistance.
Types of Insurance Available
Before committing your finances to any insurance company, you should check out the types of life policies available in the market. This move will allow you to make thoughtful choices and pick a premium within your budget. The available life insurance policies in the market you can pick from include:
- • Term life insurance
- • Whole life insurance
- • Universal life insurance
- • Variable life insurance
- • Funeral life insurance
- • Joint life insurance
- • Mortgage life insurance
- • Credit life insurance
- • Supplemental Insurance
Requirements and Documentation Needed
Where money is involved, you need to provide enough information to help beneficiaries have an easy time claiming the benefits once you’re gone. These requirements and documents you must provide are:
- • A duly filled proposal form
- • State-issued identification documents
- • Passport-sized photos
- • Proof of address
- • Medical exam
- • Income proof
- • Social security number
- • Comprehensive details of beneficiaries
When, Where, and How to Get One
You have several options if you are interested in getting a life insurance policy. You can buy your premium directly from the company online or in person. These have the same procedure, only that the application medium is different. In-person applications require you to visit the insurance company’s offices to start the process, while online applications require you to follow particular steps to complete the request.
You can also use a company agent or broker to buy a premium. In such cases, you may have to pay application fees to help process the application.
How to Calculate Your Life Insurance
When calculating your life insurance, you should add all your obligations and estimate how many years your dependents will need the financial support after your death. Subtract assets from this amount, and you’ll have your policy amount. This, however, shouldn’t be a reason to rack your mind all day because insurance companies provide policy calculators and offer additional resources to help you come up with a reasonable figure.
Cost, Validity, and Processing Time
The cost of processing life insurance cover varies from one company to the other. The validity also depends on the type of cover you pick and how much you invest in it. Once you settle on the perfect choice, you will wait up to a month for the company to process your request.