While most of us understand that life insurance provides funds
to beneficiaries after the policyholder dies, the additional
facets and benefits of life insurance are lost on many
To help you jumpstart your life insurance shopping experience,
we at InsureMe will help you identify what life insurance is,
what it can do for you, and the additional benefits it can
provide in Life Insurance 101.Basic Functions
Life insurance provides monetary funds to the people you name as
beneficiaries in your life insurance policy. In exchange for
paying the premiums, your insurance company will pay out a death
benefit to your beneficiaries after you die.
The majority of adults buy life insurance to cover immediate
expenses after they die, like funeral, burial or cremation
costs, as well as to cover any estate tax they may owe.
But life insurance can be used for more than just taking care of
your final arrangements. Life insurance is also used to provide
money for long-term expenses for loved ones.
Long-term expenses can include:
*Credit card debt
*Food and clothing
*Spousal retirement funds
It's important to remember that the main purpose of life
insurance is to alleviate financial stress after a loved one
dies, which may mean compensating for a lost income. Therefore,
taking long-term expenses into consideration will help to ensure
that your beneficiaries are adequately protected if you were to
Don't have any dependents to support? While you may not need to
supplement a lost income, unless you have the funds to cover all
debts and last expenses, purchasing life insurance is a good
idea. Doing so means not burdening friends and family with your
expenses. In addition, the proceeds from your life insurance
policy can be donated to charity in your name, allowing you to
leave something behind after you're gone.Additional Benefits
Depending on what kind of life insurance you buy, your policy
may carry additional benefits that can increase your death
benefit over time. This is especially true for permanent life
These policies provide you with lifelong protection, which means
a death benefit will be paid out no matter when you die, unlike
term policies, which may be contingent on when or if you die
during the policy's term.
The most common trait of permanent policies is that they
typically build cash value over time. As a policyholder, you can
use this cash to pay your premiums, accrue for a greater death
benefit or borrow against your policy. While stipulations may
apply to how you use any earned cash value, many policyholders
enjoy the versatility that permanent policies have to offer.
Nontheless, one size does not fit all when it comes to life
insurance. Be sure to take the time to learn about the features
of each respective life insurance policy before
to make sure you're purchasing the right policy for you. Buying a Policy
Once you've become familiar with what life insurance has to
offer, you'll probably be ready to start shopping for a policy.
Many consumers are learning that the Internet has made this task
immeasurably easier than calling multiple agents. You can get
both information and free life insurance quotes online, helping
to speed the buying process along that much faster.
While you'll undoubtedly shop around for the best price, it's
also important to find a licensed professional who will help you
assess your exact needs and provide you with good customer
service, as well as save you money. Your insurer's credentials,
customer service rating and financial standing can be viewed
free of charge through your state division of insurance and
through consumer advocate groups like A.M. Best.
Taking advantage of free resources like online life insurance
quotes and other consumer resources will help you learn about
life insurance and get the best possible deal. In the end,
you'll rest easier knowing you've secured cheap life insurance to
protect your family for years to come.
InsureMe, an Englewood, Colorado-based company, links agents
nationwide with consumers shopping for insurance. Specializing
in auto, home, health, long-term care and life insurance quotes, the
InsureMe network provides thousands of agents with insurance leads every
year. For more information, visit www.InsureMe.com.