What is Life Insurance?
Life insurance is a contract that binds the insured and the insurer for the purpose of securing the financial needs of the beneficiaries should the insured dies. This is one of the best options a person can avail of to secure the fundamental needs of the beneficiaries. Premiums must be paid, whether regularly or as a lump sum, to cover for the benefits provided by the chosen policy.
Basically, there are two types of life insurance in Mississippi:
- Term Life Insurance is a policy that covers only a certain period of time. Death benefits will only be issued if you die within the coverage period. This is the most affordable type of life insurance since it has cheaper premiums. Unfortunately, it does not build cash value.
- Cash Value Life Insurance charges higher premiums but a portion of the fund is invested by the insurance company and builds cash value. You can use the cash value for emergency situations needing immediate cash.
Life Insurance Policies: Important Things to Consider
When you are looking for a policy, it is understood that you want to protect something very important in case you die. But what are some of the important things you must consider when looking for the right policy?
- Determine your situation and needs. You have to know first what you really want to protect. Consult your agent for suggestions.
- Make sure that you can afford the premiums. Do you have sufficient funds to secure the premiums to be paid?
- Do not buy a policy unless you plan to stick to it. It will be a total waste of effort and money if you cancel the policy while it is still in effect.
- Constantly monitor your policy and compare with your current situation. Your age and health will change over the years. You have to make sure that you are still suited to your chosen policy.
- What kind of life do you want your beneficiaries to have when you die? This will have a huge impact when you are purchasing a policy because each type has a different set of benefits to offer.
- Know the possible expenses to be incurred in the event of your death. Can your family shoulder the burial expenses? What about your debts and other taxes? How about the education of your children?
Viatical Settlement for the Terminally IllThe Mississippi Viatical Settlements Act of 2000 supports the cases of insured people who are terminally ill. They have the right to receive a portion of the death benefits while they are still alive to cover for whatever expenses should they incur. It works by selling the policy of the terminally ill to a viatical settlement company. The company will then give the insured a lump-sum payment and the former will continue paying for the premiums. When the insured dies, the company will receive the full amount of the policy.
It is never costly to protect yourself and your loved ones. What matters most is you lessen their burden when you pass away by securing them with their financial needs. But when you have found the right life insurance policy, make sure that you review everything that you need to know. Everything should be secured to provide for your family’s future.