How to Determine the Type of Life Insurance You Need

By eHow Health Editor

Rate: (12 Ratings)

The best life insurance to have is the kind that is in force when you die. But since most of us live a long time, some thought should go into the type of contract we choose.

Instructions

Difficulty: Moderate

Things You’ll Need:

  • Term Life Insurance
  • Insurance
  • Whole Life Insurance

Step1
Determine how long you want your life insurance coverage to be in effect - for example, from now until your children finish college, or throughout your life.
Step2
Buy a term (fixed-length) contract with an increasing premium (annually renewable term, or ART) if that length of time is less than four years.
Step3
Buy a term contract with a level premium if you need coverage for a longer time (5, 10, 15 or 20 years).
Step4
Buy a permanent (lifelong) contract if you wish to provide a death benefit for your beneficiary no matter how long you live.

Tips & Warnings

  • Most types of permanent insurance (often called whole-life) have a cash value. You may borrow against it at a low interest rate while keeping most of the death benefit in force.
  • If your employer offers term life insurance and that's what you need, buy all you can because group life is the least expensive term insurance available.

Comments

| View All Comments
Flag This Comment

on 2/8/2008 http://www.arizonaautohomelifeinsurance.com/builderarizonacc/Peoria/index.php

I would suggest people not rely soley on group insurance. You will lose that at some point (in most cases). Look at UL with a guaranteed death benefit, or a whole life policy. If you must buy term, balance it out with some permanent insurance too.

View All

Post a Comment

POST A COMMENT

Request a New How-To Article

Looking for more How To information? Chances are there’s an eHow member who knows how to do what you’re looking to do. Submit an article request now!

eHow Article:  How to Determine the Type of Life Insurance You Need

eHow Health Editor

eHow Health Editor

Category: Health

Articles: See my other articles

Related Ads

Health

DrJewell
Meet DrJewell eHow’s Health Expert.