6 Life insurance factors you must consider

A life insurance policy protects you and your family from accidents, illnesses and injuries that can cause financial distress. It is important to understand how the system works before investing hard-earned money for extended periods of time. There are some life insurance factors you must consider before purchasing a policy:

1. Prince range
Before purchasing a policy, consider how much you are willing to spend and what your family might need in case of premature death. The lower the premium payments are, the less benefits they have. Choose a reasonable amount that can pay odd all financial obligations, related expenses and personal debt. If your children are still young, the policy should cover medical care and education.

2. Term
The longer you pay for coverage, the more expensive the quotes will be. Consider a short term policy of 10 -20 years if you only need insurance until the children graduate or the mortgage is paid. Whole life insurance can be more expensive and it is hard to modify the terms of the contract.

3. Reviewable and guaranteed premiums
Most companies offer both reviewable and guaranteed premiums. Before you establish an insurance plan, consider life insurance factors like terms, benefits and unexpected events. Although it it cheaper in the long run, a guaranteed premium cannot be modified until it the contract is over. A reviewable premium can be more affordable, but costs rise when the companies carries out regular reviews and it can become more expensive than a guaranteed policy.

4. Benefits
Benefits are important life insurance factors, because they can be quite expensive. Most policies have cash values and they can act like investment vehicles or savings. Although the life insurance quotes can be higher, consider carefully before you choose a benefit. Investing vehicles have a higher rate of return than other options.

5. Critical illness cover
Critical illness coverage pays a single sum of money that serves as complete payment if the policyholder is diagnosed with a critical illness. Another option available is a regular income or payout in case of surgical procedure. This cover can require that the individual survives a minimum number of days, usually 14. The premium can be more expensive, but if you purchase it as an add-on to the life insurance it can save money.

6. Decreasing life insurance (mortgage life insurance)
This type of annual renewable term insurance decreases at a predetermined rate over time. The premiums are usually constant, and reductions occur annually or monthly. The term is between 1 and 30 years. A mortgage life insurance is more affordable than a traditional life policy.