Insurance Insight: Life insurance 101
September was Life Insurance Awareness Month. Instead, I wrote about children and young adults and the beginning of their new school year and beyond.
Why? After years of selling insurance, I’ve noticed a few things when it comes to life insurance. People are tired of hearing the words “life insurance” from their insurance professional. I’ve heard, “It seems every time I speak with my agent, they try and sell me life insurance.”
The second thing I notice is their eyes glaze over. Either it’s because people don’t understand it, or if it’s because they don’t want to.
There’s not much to understand. You pay a premium for a certain amount of time, and if you pass away while the policy is in force, your beneficiary receives a check.
There are several life insurance policies available, such as whole, universal or term.
The coverage amount is dependent on your needs. For instance, I have a relatively small-term life policy. People have asked why I have it since I don’t have children. My response is it will help my family with final expenses, and to help with other things people face when a loved one passes.
To calculate the coverage amount, you might want to take your mortgage balance, any other debt, childcare or housecleaning expenses if your spouse passes, future college tuitions, and many other things into consideration.
The most powerful thing I experienced early in my career, Coal Seam Fire aside, was when a widow came in after her husband passed away. She had his death certificate in her hand. And the company gave her a check. You can just imagine her emotion and some slight sense of relief she felt.
Medical exams aren’t always required, though the application will ask things such as your age, height, weight, and if you are a tobacco user. The premium will vary with this information.
As always, talk to your insurance professional about options.
Susan Nichols-Alvis is the owner of Nichols Insurance Agency in Rifle. You can reach her at 970-625-0411 or visit http://www.farmersunioninsurance.com/snichols.
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