Life insurance is design for the family, partners that support them financially and work by the payments and lump sum. It is affordable and easily understandable. If you don’t need it, then you walk away from it without losing anything.
Life Insurance to buy Real Estate is create for your dependent like children, partner. It financially help the dependent after in the event of death. Demand various things about life insurance while buying like which type of policy want, when need it and how to purchase it.
How does life insurance works?
Pay the life insurance either by the lump sum or regular payment on your death. After the death, it financially help the dependent. The cash that support financially dependent, depend on the level of cover you purchase. Decide how it paid that it cover the specific payments like mortgage or rent instead you leave the family.
Types of Life Insurance
Two types of life insurance are as follows:
- Term life insurance polies
- Whole of life insurance polies
- Term life insurance polies
This policy run for a fixed period. That’s why, it is called term policy like five, ten or twenty five years. If one is die, then it pay out the policy.
It is further classified into three kinds
- Level: The most simple and affordable option is the level. One is die during the agreed time, then pay as a lump sum. The cover is always same in it.
- Decreasing: Cover level is reduces every year. It is made for the repayment mortgage when outstanding loans is decreases by the time.
- Increasing: As per name, the level of cover is increases by the time of policy due to keep up with inflation.
- Whole of life insurance polies
These payment does not create any matter at the time of death. But keep up with premium payments. These are generally use to help the funeral or inheritance tax planning. It is more expensive than short term policies. It also offer the chance to end up paying more if live longer than the expectations.
Whose life are cover?
You have options whether choose joint policy or the single policy.
- Joint life insurance: The money go to surviving policyholder like spouse in it unless made alternative arrangements.
- Single life insurance: in this, the money go to estate. For this purpose, need to decide who it goes to at the death time.
The joint life insurance is better and more affordable than single policies because the joint policies cover only one payment on first death but in single policies, cover the payments on each death.
Need life insurance
life Insurance to buy Real Estate is require not for the time when one is disable or illness while it require only after the death. It suit to the following persons
- Dependent like children of school age
- Partners who depend on your income
- Live in mortgage house. The life insurance support them after the death.
- The life insurance is need for many purposes like cover the funeral expense.
The people do not need life insurance when
- Partner earns money that is enough for the family
- Low income but qualify the state benefits
The persons who work already have it. It include in services benefits of employee packages that provide the level of cover that link with the employee’s salary. To calculate its worth not by the extra life insurance policy. But remember one thing that if one want to switch it, then stop working for the employer. If receives the payouts, it will effect on means test benefits. The dependent need these benefits.
How much is life insurance?
life Insurance to buy Real Estate People think life insurance has good value but is cost varies due to number of factors. it cost few pence per day and give the amount that provide protection to one’s loved persons but monthly payments is based on age, health, one is smoker or not, lifestyle, medical history of family, occupation (high risk jobs increases the premiums) and policy length.
The price is based on the level of cover that purchases and this level of cover is depend on rent, mortgage, number of dependents, debts and income, get from the other sources.
How buy the life insurance
Premium varies and get life insurance quotes from banks, insures, comparison sites, credit card companies, financial advisors, brokers, retailors and who provide the mortgage.
Remember things when buying life insurance
Medical history is correct
Most claims are correct because one provide correct information to the insurer. They check medical history when make claim. If answers are not correct, then they will not pay out.
Read small prints
Read it carefully, one should what is in it or not in it. Read the definitions and exclusion because these are vary between different insurers. Understand all the points that mention on it. If something do not understand, give help from the financial advisor, insurance provider and others.
Change the mind
One can change the mind because he has 30 days from policy purchases to change mind and get full refund. One cannot change the mind if policy is cancel.
Switch to better deal
Better choices and opportunities are available if one is young and healthy. Try to buy it when young because in old age or due to medical illness, it finds difficult to buy the policy. If decide to switch the policy, do not cancel the existing policy until replacement policy is set up fully.
Ask for additional features with some insurance policies are consider as a waiver. Like add waiver of premium to policy-no work is done due to accident or medical problems, then premium paid automatically. It gives protection to the cancellation of policy if do not make monthly payments.
Advantages of life insurance
Gives the inner peace
If one is die due to any reason like road accident, then he has feeling that he left some financial backup for their dependent. Actually life insurance provide you tremendous tranquility and not only one get the inner peace but also his family and his partners. One has feeling that he protect the family with help of life insurance.
Cheaper and easier
Two type of insurance are permanent life insurance and term life insurance. The permanent life insurance is for lifetime but cost is high and term life insurance is for some period like 5 or 10 years. Most of process is done online in term life insurance. For example, firstly, submit application, get instant decision on eligibility and then start coverage.
Payouts are become tax free after the death. It does not mean it gives directly to one’s family.
Disadvantages of life insurance
Life insurance cost money but it is affordable particularly in case of term life insurance because it covers for fixed period of time. Cost of term life insurance is less for healthy people.
Reminds you the responsibilities
Life insurance is for the dependent. So, it realize you that many serious responsibility held on you. Then one may be make responsible person.