5 Things Millennials Should Know About Life Insurance
Millennials are referred to as people between the ages of 22 years and 38 years. They have a common misconception that life insurance is not necessary and therefore does not find out what to know when buying life insurance.
This misconception has denied many of the benefits that are associated with this insurance policy.
Life insurance secures the future for your family by settling all your outstanding debts and preventing your loved ones from running out of funds after your death.
These are highlights that you need to think about before ignoring this insurance policy.
Millennials have a lot to learn or put into consideration when purchasing a life insurance policy and here are the things you may what to know when buying life insurance:
It Requires A Process
There is a process between application and approval of an insurance policy which is between three to four weeks.
You will first require filling an application online after which a phone interview will be conducted. The insurer will be able to gather more information needed for the policy via this conservation.
After this, you will be expected to take a medical exam. The medical exam involves a physical assessment of the body while a test will be conducted on your blood and urine. The entire medical process may not exceed thirty minutes.
However, some insurers offer accelerated underwriting which skips the medical aspect. An example of this is simplified life insurance.
The simplified life insurance is much more costly as compared to other life insurance policies because the major determinant of your chances of living is being skipped.
It offers limited coverage and except for situations of a serious health challenge, it is not advisable for you.
An insurance policy takes effect once the first premium is paid and it elapses when you stop making payments for your premiums although a grace period of about thirty days is given to make up for a missed payment.
As a millennial, the protection you stand to enjoy is one out of the list of what to know when buying life insurance.
Presently, life insurance might be the last thing in your list of desires but when you start settling down, have a spouse, and having children, then it becomes important security that you must take up because it represents your financial safety.
It sustains your family members in times when the unfortunate happens and you are no longer there to be able to provide for them because you have passed on.
Your loved ones will have no worries over the bills to be settled or concerns for their regular upkeep after your demise.
Note that the payment that will be paid to your loved ones after your demise is referred to as reimbursement and not income so, therefore, it won’t be taxed.
Variety Of Policies
This is another aspect of what to know when buying life insurance
There are different policies with diverse terms and conditions linked to them. It is good that you understand what you are trying to achieve before settling down for any.
For instance, if you what a policy that covers for your whole life, if you may want to consider Whole life insurance while Term life insurance is valid for a period of time.
There’s also universal life insurance, variable life insurance, variable universal life assurance, and much more.
No one gets younger, and the older we grow, the weaker the health. No matter the packages you give to your body, your health will tell your actual age.
So you should become a part of an insurance policy that will be of great benefit to both you and your family because no one hopes for unpleasant circumstances but when it comes, there’s nothing that can be done but the insurance policy can help to minimize the pains and worries.
Also, the premium for an insurance policy increases by about 10% yearly. This is to let you know that it will never get cheaper than what it is now making it a part of what to know when buying life insurance.
In addition to what to know when buying life insurance, is your way of life that determines life insurance premiums.
With the aid of medical facilities, the state of your health is assessed by your insurer to determine the likelihood of your demise during the term of the policy if it will be early or later.
The major factor that predicts the likely period of your demise, is your health records and other factors like your driving history.
If you are engaged in risky hobbies such as skydiving or bad habits like drunkenness and smoking, then there is the tendency that you will be charged higher rates because of the risk involved.
If you are presently addicted to dangerous drugs like marijuana, there is every likelihood that your coverage may be denied but if you had a previous history, your insurer will require a frame of time before putting your application into consideration.
More so, don’t be smart in your eyes trying to lie about your health because it will surely be exposed and as a result, your application may be rejected or attract a higher premium. If by any means your lie wasn’t exposed and the policy goes into effect, and along with the line truth is revealed, your insurer may cancel your policy, and worst still, the amount due to be paid after your death won’t be paid.
However, getting healthier can give you the opportunity for lower rates even after your policy has taken effect. Some insurers may allow you to have other medical exams within two years after your policy has taken effect. If the result comes out fine and better than you can have your premiums lowered.
Besides, you can still shop around for less risk-averse insurers that offer better packages for ex-smokers
There is a period within which life insurers look back to the information you provided to determine its genuineness and check if any fraud was involved. It is known as a two-year window which starts from the date the policy becomes effective.
Therefore endeavor to provide detailed and true information about you as it is part of what to know when buying life insurance.