Buying Life Insurance: A Checklist

Life insurance can be an effective tool to make certain and protect your
family's financial future. It has been acknowledged universally as a method
by which the breadwinner can substitute risk and uncertainty with timely aid
for the family in case of their unfortunate death.

Since a life insurance policy will replace your lost income after your
death, it is important to choose the right kind of policy. Hence, it is
essential to find a company that will cover your insurance with the right
amount, and at a reasonable price.

Need for a life insurance policy:

There are several reasons for an individual, specifically a breadwinner, to
make out a life insurance policy. To assuage your concern for your family in
case of your death, most life insurance policies offer various death
benefits that take care of your family after your death:

1. For example, a member of your family may have some special needs. You can
buy a life insurance policy that will act as an emergency fund in the event
of your untimely death.

2. If you want to make sure that your child gets quality education even
after your death, a life insurance can also work as a fund for your child's
education.

3. An insurance policy will ensure the maintenance of your family's standard
of living.

4. Your family can also use it to clear personal and business debts, after
your death.

Duration of insurance coverage:

Before buying a policy it is advisable to ensure the duration for which you
want life insurance coverage. You can take online help to decide the
coverage duration.

Need for a checklist

After you decide on your specific need, and the duration of your life
insurance policy, you can begin looking for a suitable policy. It is prudent
to prepare a checklist before buying, as this will ensure that you end up
purchasing the right policy.

The checklist must include various factors on which you can assess insurance
companies, which includes various criteria set by insurance companies too.
Here are a few pointers:

1. Before buying a life insurance policy, it is advisable to ensure that you
have all medical information regarding your health, because most companies
expect that, depending on your age and the duration of insurance coverage.

2. It's a good idea to compare various life insurance companies on the basis
of quotes that they have to offer. You can take the help of the Internet to
compare the quotes based on your choice of insurance product and your age.

3. You can also take help from a broker through the telephone or the
Internet and clear all your queries.

4. Once you decide on a particular insurance company, it is important to
ascertain the company's financial strength and stability.

5. It is also advisable to gather information about the options for renewal
that various insurance companies offer, because some companies charge high
premiums if you renew your policy.

6. Some insurance companies charge a penalty if you cancel your policy, so
make sure that the company you choose does not demand a penalty on
cancellation of policy.

7. You may also want to make some changes in your policy in due time, as
your insurance needs can change with time. So, when you purchase your
insurance policy find out if there is an age limitation for any kind of
conversion of your policy, and whether the option of moving into a better
policy is there.

About The Author: Joe Kenny writes for the UK personal finance sites
http://www.ukpersonalloanstore.co.uk and also http://www.cardguide.co.uk