Interested in life insurance in Ohio but do not know where to start? Not sure if you need it. How much do you need? What type of policy you should get? Well, here are 10 tips on buying life insurance!
1: Don‘t overpay for Life Insurance
If you‘re looking for life insurance in Ohio there are many options for you to choose– years of coverage, types of policies, insurance amount, and your cost. You can find a policy to meet your needs at a cost you can afford!
One thing that always crosses peoples mind when purchasing insurance is, “Am I getting the best deal?” When shopping for life insurance there are a few steps you can take to make sure you are not overpaying for your policy.
- Select a reputable insurance company and an experienced Agent
- Do your research – this article is all encompassing
- Look at multiple alternatives Do not be afraid to ask questions of your Agent.
The common factors that go into pricing for life insurance are: age, sex, health status, type of policy, coverage amount, and nicotine use.
2. Know the type of life insurance you want
When purchasing life insurance in Ohio, consider the four popular types – Term Life, Whole Life, Universal Life, and Indexed Universal Life
Term Life:
A Term Life policy will provide coverage for a specific period such as 10, 15, 20, or 30 years. Term life provides affordable high–level coverage that can be used to provide financial security for the length of term you select Term life can be intended to cover the cost of – living expenses for your beneficiaries including mortgage, utilities, college expenses, etc.
Whole Life:
Whole Life is considered a “permanent” life insurance policy using a fixed interest rate that provides lifelong coverage at fixed monthly payment for life. Whole Life Insurance policies do not expire, have a death benefit, and a cash value that is an investment–like tax deferred savings account. Whole Life offers lifetime coverage as long as the premiums are paid, however they can be up to 2x more expensive than a term policy. Whole life can be a worthwhile retirement investment and death benefit for estate planning.
Universal Life:
Universal life is considered “permanent” life insurance and is actually a whole life policy using a variable interest rate for lifelong coverage at an expected fixed monthly payment for life. Universal Life is similar to whole life where it is a lifelong policy and accumulates a cash value. One advantage is that you can adjust the premium you pay as your life situation changes. While there are minimum required premiums, you can adjust the premium to increase or decrease your tax – deferred cash value. Universal life is less expensive than a standard Whole Life policy since the interest rate inside the policy is not guaranteed
Indexed Universal Life:
Indexed Universal Life is the same as a Universal Life policy except that the saving portion ( or cash value) of your policy is tied to a stock market index. Therefore, your saving portion has the possibility of increasing at a higher rate. Your rate is guaranteed to not drop below zero.
Quick Recap:
Term Life – Provides high level coverage for a set time period (10, 15, 20, 30 yrs.). Often the most affordable option. Whole Life – Lifelong policy, consistent premium, builds cash value. Higher premium cost than term policies. Universal Life– Lifelong policy, flexible premium , can build cash value at a higher rate. A good retirement tool. Indexed Universal Life – Lifelong policy , flexible premium, can build cash value at a higher rate. A good Investment tool.
3. The best age to buy life insurance at
The best age to buy life insurance is today at age you are now – since you will never be any younger again. Life insurance can be purchased at any age but there are stages and times where a certain type of policy might make more sense than another policy. Life insurance is typically purchased when someone is dependent on your income or you have outstanding debt that would become someone‘s responsibility.
Term life is a popular first choice – for high dollar coverage with low premium costs. For parents, term life is a great option to protect children until they are grown. In the event of a parent‘s death, life insurance could fund things such as family living expenses, child care, college bills, etc.
A permanent life policy is intended to keep the same premium costs ( without increases) for life time coverage . Life insurance premium costs are determined by age and health factors. Starting a policy early can guarantee you a policy at a lower premium as you age.
Quick Tip! Whole life insurance policies can be purchased for minors , even infants. Once the minor becomes 18, they have the option to increase the policy coverage, They can also surrender the policy for the cash value in the policy to be used for personal expenses such as college funding or other life choices..
4. How to select your life insurance beneficiaries
A life insurance beneficiary is the person or persons who receive the proceeds of your policy in the event of your passing. You can name more than one beneficiary and divide the amounts upon individuals or place the funds in a trust for a minor. There are multiple, flexible, options to fit your need and it is best discussed with your agent.
5. Understand who needs life insurance in Ohio
There are two things in life that you can count on – Death and Taxes. Most people expect a long life. But you never know. Life can be dangerous. While there is not a one–size–fits–all approach for who needs life insurance, there are various situations that may apply to you where a policy would be helpful.
Think about these questions when deciding if you need life insurance:
Would my death financially impact people in my life? How would funeral cost be covered? Would someone inherit my debt? Who depends on my income? You should wish to leave a legacy for your family or a charity.
6. Tip to know how much life insurance you need
You have decided to purchase a life insurance policy, but now are thinking, “how much do ! really need?”
The obvious things that come to mind are paying off a major debt such as a mortgage, car loans, and credit card debts. However, think about things such as helping a spouse or partner pay bills for at least 10 years, supporting children, paying for college tuition or long term needs. How long could your family survive without your income? How long would you want them to have access to that income as if you were still there?
A good rule of thumb is a death benefit equal to 10 times your annual income.
7. Understand how your health affects your life insurance rate in Ohio
Your health is a large determinant to your life insurance eligibility and rating. The younger you are, the lower cost life insurance will be. The younger you are, the healthier you tend to be; therefore you are less risky to insure. Smoking, weight, medical history, career, and lifestyle all affect your life insurance policy. Even your driving record can affect your policy. The best option is to buy today before you become older!
Buy a life insurance policy when you are healthy just in case any medical factors would later on exclude you from coverage.
With that being said, do not let a preexisting medical condition stop you from seeking coverage. You may be still eligible for coverage with heath issues.
8. Personalized service is very helpful when selecting a plan
Life insurance in Ohio is an extremely customized product. Who you are, what you do, and your lifestyle all affect the type of policy best fit for you. Working one on one with an agent is extremely important when selecting life insurance. While online quoting may be tempting, life insurance requires a deeper conversation to make sure you are getting the most for you and your family. An agent can further assure that your intended beneficiaries –in future years– will be located and receive your benefits.
Working with a local agent will assure that you acquire a policy that meets your wishes and fits your budget.
9. Choose an insurance agent with great customer service
Always choose an insurance agent you feel comfortable with! Life insurance is a very personal subject and the application process includes discussing personal information. Find an agent who is there for you and takes the time to listen to your needs and dive deeper to secure the right policy fit! An agent is responsible to you, the client.
10. Choose Ted Day as an Agent!
Ted Day , Licensed Agent, is committed to helping you find the best policy to fit your needs. Ted is available 24/7 by phone or email and by appointment every day. You need to take the initiative to call. Ted can readily provide quotes and answer your questions. Ted has over 30+ years financial services experience and is well suited to help you make the best decisions for your financial life.
