Having life insurance is an essential, but you might be concerned about the effect that your premium will have on your budget. Regardless of what you can afford to spend each month on insurance, however, there is surely an option for you. By understanding how term life insurance rates are determined and by looking at your other options, you can choose the right coverage for your needs and budget.
Luckily, we make it easy here at United Life Group. After looking at this guide and understanding a little more about the different types of insurance and how rates are determined, you can enter your ZIP code into the form at the top of the page. Then, you can instantly receive quotes online from all of the best companies in the business, which can help you find affordable coverage that suits all of your needs.
Understanding Different Types of Life Insurance
Term and mortgage life insurance are very popular choices for many Americans, but there are other options as well. By first determining which types of coverage you might be interested in, you can then look at a rates chart or enter your information for a free online quote to help you make the right decision. You might find that term life is the most viable option for you, but it’s still a good idea to determine your other possibilities; then, based on your situation and budget, you can choose the coverage that fits your financial situation while providing you with the coverage you need.
Term Life Insurance
Whether you are looking for term life insurance rates for senior citizens or for younger adults, you will find that this is a popular choice. With term life insurance, rates are generally lower than with whole life insurance and other types of coverage. This is particularly true for younger, healthier individuals. When you invest in this type of policy, you will have coverage for the length of your term. If you pass away during this time period, your beneficiary will receive the face value of the policy. After the term has ended, however, you will have to renew in order to maintain coverage. Unfortunately, your premium could go up significantly at this time.
Mortgage Life Insurance
This type of policy is actually a form of term life insurance. With mortgage insurance, you purchase a policy with a face value that equals the value of your home. Then, if something happens to you before your home is paid off, your family will have sufficient funds to pay off your mortgage. This can provide peace of mind because it guarantees that your loved ones will always have a place to live, even if you aren’t there to cover the house payment. As a homeowner, this is something important to look into, and there are two ways of gaining this type of coverage: You can either get it through your mortgage lender, or you can purchase it on your own.
Although many people choose to get this insurance along with their mortgages, this isn’t always the ideal option. With that type of policy, the bank will be listed as the beneficiary and will be paid at the time of your death; then, if there are any leftover funds after your home has been paid off, the remaining money will be distributed to your loved ones. With insurance that you purchase on your own, however, you can list anyone as your beneficiary, such as your spouse or children. This means that your loved ones can choose to spend the money on more pressing matters if necessary and won’t be required to pay off your mortgage if they don’t want or need to.
Whole Life Insurance
Whole life insurance varies from term life insurance because it doesn’t have an expiration date; instead, it provides you with coverage for the rest of your life. These policies can be more costly, but they do have their benefits. Along with guaranteeing coverage as long as you pay your premiums, they can gain a cash value over time. This money can be paid out to your beneficiaries, or you can borrow it after it has matured. Even though whole life insurance can be more costly than term life, you should consider using our easy-to-use search engine to get a quote. Depending on your situation, it might fit into your budget and can serve as an investment. For example, whole life insurance rates for seniors can actually be more reasonable than other types of policies for those who are looking for a smaller face value and who don’t want to deal with the more stringent underwriting policies that can go along with term life insurance.
Universal Life Insurance
Similar to whole life insurance, universal life insurance offers coverage for life. It can also accumulate a cash value over time. There are some key differences that you should be aware of, however. First of all, if you’re looking for cheaper permanent coverage, you might find that this is your best option. You will have the ability to set your premiums and your death benefit, so you have more flexibility than you would with a whole life insurance policy.
There are some drawbacks as well, however. If interest rates drop, you might find that you have to increase your premiums in order to maintain your death benefit. This means that although this type of policy can be more flexible in the beginning, there is the potential for your premiums to rise over time. This is never the case with whole life insurance, however.
If you’re looking at rates by age, you will probably find that burial insurance is the cheapest option for many senior citizens or those with significant health-related issues. Burial insurance is a great option for those who are looking for no exam life insurance or who don’t have much to spend because underwriting is typically very easy and lenient. Face values for these policies are typically much lower, but they can offer enough to cover funeral costs and some final expenses.
Tips for Choosing a Term Length
If you have decided that term life insurance might be the option for you, you could be having a hard time deciding between 10 year term life insurance rates, 20 year term life insurance rates and the terms that are available in-between. Choosing the right term length is essential to get the highest level of coverage from your policy, so you have to look at your current stage of life when choosing a term length. Here are a few factors to consider when choosing the length of your term:
- How much do you have to spend? If you’re still pretty young and are on a tight budget, 10 or 15 year term life insurance rates might be the right fit for you. These policies are generally most ideal if you will still be relatively young when the term expires and if you hope to be in a better financial situation at that time.
- What are you using your insurance to cover? If you have small children and want to make sure that their college educations are paid for if something happens to you, 20 year term life insurance rates might fit your needs and budget. If you have a 30-year mortgage and would like to have enough coverage to pay it off, you might want to look for a 30 year term.
- How old will you be when your policy expires? When it comes time to renew your policy, your insurance company will look at your age when giving you a new rate. Therefore, it is a good idea to choose a term length that will put you at an age at which you can still secure affordable coverage when it expires.
Here are some things to think about in regards to the correlation between term lengths and costs:
- Longer terms typically come with higher premiums.
- Your rates can go up by 10 times or more at the end of your term length if you will be a senior citizen at the end of the term.
- Many younger individuals opt for less expensive, shorter term lengths for their first policies; then, they are still young when they renew their policies and are often in a better financial situation to pay for a longer term length.
- Return of premium term life insurance may cost more per month, but the advantage is the premiums are refunded 100% if the insured outlives the term length.
Other Factors That Can Affect Premiums
Although term lengths obviously have an effect on the average rates for insurance shoppers, there are other factors to keep in mind when choosing insurance. Then, you can look for the policy that suits your needs based on your current situation.
- If you have health-related issues, you might be looking for life insurance that doesn’t require a medical exam. With term life insurance, rates can be much higher for those who don’t participate in one of these exams. In this situation, you may want to look at burial life insurance or a small whole life policy.
- The face value of your policy will obviously have an effect on how much your premiums are. If you are young and are able to secure coverage at a great rate, you may want to opt for a policy with a higher face value. This is also important if you are expecting to leave behind a lot of final expenses. If you are older, are on a very tight budget or have health-related problems, however, a small face value could be the better option.
- Different types of insurance come with different rates. For example, burial insurance is often one of the most reasonably-priced types of policies. Term life is less costly than whole life for those who are younger and in reasonably good health, but those in other situations might find a small whole life policy to be a more cost-effective option.
- Your health can have a major impact on how much you have to pay for coverage. If you are in good health, it is generally a better idea to succumb to a health exam — which will be covered by the insurance company — so that you can secure these lower rates. If you have moderate to serious health-related issues, however, you may want to seek a policy that only asks a few simple health-related questions for the lowest premium.
Get the Lowest Rate on Life Insurance
Choosing coverage might not seem easy, but we can help make it as simple for you as possible. We work with the top-rated life insurance providers in the nation, and our company is licensed to sell term life, whole life and burial insurance to residents from several states across the country.
We want you to secure the policy that you need at a rate that you can afford, so we have provided a simple tool to help you make the right decision. To get started, you can simply type your ZIP code into our simple form at the top of the page; then, you will have instant access to rate quotes for different types of coverage from different providers. This can aid you in your shopping and selection process and will help ensure that you don’t wind up paying too much for your policy. To get started toward securing coverage for yourself today, enter your information and take a look at your options.