Life insurance, also known as income protection or death cover, plays a crucial role in financial planning for uncertainties like sickness, disability, and untimely death. It is essential to have a closer look at the life insurance policy that you plan to purchase.
Life insurance can help lower the risk when unexpected or unfortunate happens as it can assist in settling immediate financial needs like funeral costs, healthcare costs, estate taxes, and unpaid debt. With that said, here are three things that you should consider when purchasing a life insurance policy.
Amount of Coverage
Similar to other insurance products, one crucial factor to consider is the amount of coverage when purchasing a life insurance PH policy. It is helpful to choose a policy that meets your specific needs, especially when considering your monthly income, other financial obligations, and liabilities your family is left with when an unexpected situation arises.
Another thing to consider when choosing a life insurance policy is the period of coverage. You can either opt for term insurance that can give coverage for a fixed period and you can renew or a permanent insurance that covers you for your entire life.
Aside from this, there are also other policies under permanent life insurance, which are whole life policy and variable universal life (VUL) policy. They both provide coverage for the insured in their entire life, but the difference is that VUL enables a flexible premium, and its interest rate can see changes over time. In whole life insurance, there are fixed policy premiums and interest.
Insurance Provider Reputation and Financial Stability
Looking for a reputable and financially stable insurance company is another factor to consider when it comes to purchasing an insurance policy. It is essential to choose an insurance provider that offers quality insurance products and services, is compliant with specific regulations, and has reputable claims in their handling practices.
To know if the insurance provider has a positive reputation from other people, you can look at online reviews from clients or ask peers who have taken out an insurance policy from them.