Three Questions to Ask When Buying Life Insurance

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Life insurance tends to be an unpopular topic of conversation. It requires us to think about and plan for the future, as well as decide how to best protect our loved ones if we were to pass away. You might even have questions about buying life insurance.

As a result, it’s not surprising that 50 percent of adults in America have no individual life insurance, and 39 percent believe they need more coverage.* Because it’s something we don’t want to think about, we tend to put it on the back burner.

Let us help make life insurance a bit less daunting. This article will explain common questions about life insurance. Consider these three questions when buying life insurance.

How much life insurance do I need to buy?

The answer to this question will vary depending on who you will need to cover. Do you have a spouse and/or children? How old are your children and how many years will you need to provide for them? Do you want funds available to help pay for funeral expenses or college?

The truth is that there is no ideal dollar amount of life insurance coverage to own. It really is dependent on your lifestyle, current needs and potential future needs. When determining how much life insurance coverage is right for you, consider your current salary and make sure to figure in inflation. Plus, you can always talk with your First Financial account representative for further guidance.

What coverage is available?

Take note of the types of plans available through your employer. Some employers offer a small amount of group life insurance that is available to you as long as you are employed. Plus, your employer may pay 100 percent of coverage – just be sure to check your benefit details to find out for sure. Additionally, you may also have voluntary term or whole life insurance plans available for purchase separately.

  • Group life insurance amounts are up to the employer and will be outlined in your benefits information. A group life insurance plan is an excellent way to have coverage while you are employed. However, keep in mind the plan may terminate if you leave employment.
  • Term life insurance is exactly as the name implies: You are covered for a specific term, such as 10, 25 or 35 years. Because you are only covered for a certain time period, rates tend to be more affordable, especially if you sign up while you are young.
  • Whole life insurance plans remain in force either as long as you are alive or up to a specified age. It is a permanent plan. The policy will stay active until you need it, as long as you pay the premiums. Rates may be slightly more expensive than group or term life insurance plans, so be sure to weigh your needs carefully to decide whether this is the best option for you.

How do I sign up?

Ask your employer about available life insurance plans. If you are a First Financial customer, you can find life insurance plan details in your benefit booklet and on your Employee Benefits Center.

*LIMRA: 2017 Insurance Barometer Study; April 2017, pgs. 19 and 22.

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