The first step when shopping for life insurance is contacting an independent agent who can explain your coverage options and help you compare policies and providers. The right coverage can provide a lifetime of financial security for your loved ones. Too little coverage, on the other hand, could leave gaping holes in your family’s finances that create a burden for years to come. That is why many Minnesota families are choosing Krog Insurance for their life insurance needs.
When Should You Purchase Coverage?
Like all types of insurance, life insurance is better purchased sooner than later. You never know what the future may hold – even if you are young and healthy. Your family cannot wait until it is too late to purchase the coverage they would need in the event of an unexpected loss. By securing life insurance now, you enjoy peace of mind knowing your loved ones are already taken care of. Not to mention, the younger and healthier you are, the more affordable your premiums are likely to be.
Uses for Life Insurance Benefits
Life insurance benefits are often used to cover final expenses, such as burials, funerals, and cremation. However, the money that goes to beneficiaries can be used for much more than that. You can designate it to be used for nearly any expense, including:
- Debt and mortgage payoff
- Medical bill payoff
- A child’s education
- Household expenses
- Dependent care
- General income replacement
- Charitable contribution
- Spousal retirement support
- And more
Depending on the type of coverage you purchase, you may also be able to utilize life insurance for living benefits, too. In fact, some life insurance policies can become powerful tools for wealth generation, growing in cash value over time.
Types of Life Insurance Coverage
There are many types of life insurance. However, nearly all policies can be described as either permanent coverage or term coverage. The type you choose should correlate to the stage of life you are in and your future financial goals.
Permanent Life Insurance
Permanent life insurance is coverage that never expires no matter how old you are. You can purchase different types of permanent life insurance, including whole life and universal life. Whole life insurance features level premiums for the life of the policy, whereas universal life provides greater flexibility in the amount you pay for coverage over time. In addition, this type of policy has an investment component, meaning you can accumulate and grow its cash value over time.
Term Life Insurance
Term life insurance is coverage that is designated for a specific term – usually between 10 and 30 years. At the end of the term, the coverage expires with no cash accumulation benefit. Despite the expiration, however, term life insurance can provide valuable benefits. Typically, the death benefit on this type of policy is much higher in relation to the low cost of the premiums when compared to a permanent life insurance policy. This makes it an affordable option for families who need to provide income replacement for surviving dependents in the event of an unexpected death.
You can choose a term life insurance policy worth hundreds of thousands or even a million dollars or more. We recommend a term length long enough to cover you until your children are financially independent, your retirement is fully funded, and you have paid off major debts, such as the mortgage.
How Much Life Insurance Do You Need?
How do you determine the lump sum amount your loved ones might need after your passing? Attempting to calculate this number on your own can be a challenge – particularly if you forget to account for certain costs or inflation. Instead, consult with Krog Insurance to learn how to more accurately calculate your coverage needs based on various factors like:
- Your age
- Your outstanding debts
- Your current and future income
- The cost of maintaining your household
- The cost of dependent care
- The age of your dependents
- The expenses your family is saving for
- And more
Private Life Insurance vs. Group Life Insurance Coverage
If you are offered group life insurance through your job, it is okay to accept it – particularly if it is employer-paid. However, group coverage should not be a substitute for your own private life insurance policy. With private coverage, you control the terms, coverage amount, and any riders you wish to add to the policy.
With a group policy, your coverage is designed to meet the needs of a group of people – not your family. It often comes with low benefit amounts, and your coverage may be terminated if you lose your job. By then, changes in your health and age could affect your ability to qualify for the lower rates you may be eligible for today.
Shop for Minnesota Life Insurance with an Independent Agent
Remember, no one can assist you in finding coverage and comparing quotes from multiple insurance companies quite like an independent life insurance agent. Krog Insurance will be there to answer your questions, offer coverage advice, and help you select a policy designed to meet the needs of you and your family for decades to come.