First, decide how much life insurance you need to provide financial stability for surviving loved ones. One way to choose a figure involves totaling outstanding debts, medical and funeral expenses, student loans, mortgages, childcare and education costs, and more. Some prefer an income-based life insurance benefit.
In general, there are two categories of life insurance - term and permanent. Term insurance lasts for a specific time - 1, 5, 10 years or more. Level, decreasing, and increasing term are policy variations that affect death benefits and cost. Term policies are renewable, but rates increase with age. Permanent insurance provides lifetime coverage and builds cash value. Universal, variable, and single premium life are examples of permanent life insurance. Depending on policy specifics, there may be features like flexible premiums, investment options, borrowing against the cash value, dividends, and more.
Assess your health and hobbies. A chronic medical condition may limit options, increase the cost, or make you uninsurable. Engaging in risky activities like skydiving and racing could make it difficult to obtain coverage.
Get several quotes. Contact local life insurance producers or online agents. Be ready to discuss life insurance coverage needs, product preferences, budget, and personal information. Eligibility, pricing, and coverage options vary by insurance company. The final rate hinges on your application, medical history, lifestyle, financial background, and a basic health exam.
Do not choose a life policy on price alone. Consider coverage options as well as the prospective company's financial strength, complaint record, and licensing status. Insurers not licensed in Illinois are not subject to state insurance laws.
Review the life insurance contract when it arrives. There may be documents to sign and send back. You have ten days to return the policy for a full refund if it does not meet your needs.