InsuranceLecturer — In some cases people may not be completely sure that taking life insurance is right for them. The reason for this is because you are looking at taking out a policy which you may never need if you do not die within the term of the plan, therefore you could pay out money and receive no benefit and people may not be sure that it is worth it and some people may take that gamble and use the money for other matters.
Like a lot of things life insurance has its pros and cons and with out really looking into it you may not discover these. Some of the advantages of this type of insurance can be that you are taking out a policy to ensure that existing debts like your mortgage, loan or any other finance are covered and are catered for once you have gone, to make sure that your any financial needs are taken care of.
The money could be used to make sure your final expenses are covered such as funeral expenses. This type of policy will become more costly to take out the insurance as you get progressively older. Some insurance companies are more guarded than others on the underwriting process and may require further evidence to back up any questions raised on the application submitted.
It is becoming more common for companies to try and reduce the monthly premium if you are applying for more than one cover at a time, for example if you and your wife or husband are both looking for a life insurance policy you could take out two single plans and receive a monthly policy discount where the insurance provider does not charge a plan fee on the second plan or even third or fourth plan if you wanted a number of policies.
If taking out a joint policy the benefits of the insurance will only be paid out once and can only be claimed for once and the cover will cease once the claim has been paid. If a company however does not accept a claim for a reason such as non disclosure then the policy would again cease and any premiums paid would be refunded. When a life insurance application is submitted to an insurance company some of the factors that they typically take into consideration and use to underwrite your application are things like:
- The gender of the applicant, generally males have a shorter life expectancy (however this will change in 2012).
- The family medical history, if your family have history of for example diabetes, high blood pressure, heart attacks, cancer etc the insurance company may consider you to be at a higher risk of developing something similar.
- Tobacco usage. If the applicant is a smoker they may be more susceptible to developing a major illness as apposed to a non smoker.