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Life insurance is a financial product that can help offer protection to your loved ones if you pass away and, in some cases, an additional vehicle to build wealth. However, navigating the many types of life insurance when buying for the first time can seem daunting. Every policy type comes with different features and benefits to suit various needs. Let’s dive deeper into how to get life insurance for the first time, including how to compare policies and tips for finding the best coverage.
Life insurance helps to cover your beneficiaries if you pass away via a death benefit payout. Your beneficiaries can use this for various purposes, from helping to cover lifestyle expenses to helping save for future goals. You can pay regular premiums to maintain this coverage.
It’s rarely too late to get a life insurance policy, but getting coverage earlier in your life can be beneficial. Premiums increase with age, but you can lock in your rate after purchasing the policy.
Here’s how to compare life insurance policies to find the right coverage at competitive rates:
The coverage amount, or death benefit, is the amount paid out to your beneficiaries after you pass away. The more coverage you get on any given policy, the more you’ll pay.
Here are some common types of life insurance policies:1
Premiums are the cost you pay to maintain your life insurance policy, and can vary by policy type and insurer. It's wise to get a policy with premiums that fit your budget without sacrificing coverage.
Riders are extra features you can add to your policy for free or at an additional cost to customize coverage. For example, a long-term care rider may let you take your death benefit early to cover medical and other expenses for qualifying long-term illnesses or injuries. Another example is an inflation rider, which raises your death benefit every year to keep pace with inflation.
Don’t wait until it’s too late. Help cover yourself and your family with coverage from Aflac.
Follow these tips when buying life insurance for the first time:1
You’ll need enough coverage to help protect your loved ones without overpaying for coverage you don’t need. Evaluate your income, living costs, and potential future expenses to estimate your needed death benefit. Try to account for inflation as well.
Insurers may offer different rates and terms for the same policy type and coverage amount. Therefore, shop for multiple quotes and compare each to see who offers the lowest premiums and best terms on the policy type you need.
Several factors can impact your premiums in addition to policy type and coverage amount:2
Applications require a lot of information about you, including personal information, a personal and family medical history, and other insurance policies. Gather the necessary documents and information to complete your application more quickly and easily. Contact the insurer if you have any questions about the documents needed.
When you pass away, the insurer will look over your answers and investigate the cause of death. They may reduce the death benefit payout or deny the claim if they determine you misstated or omitted anything intentionally. Therefore, honesty is vital when filling out a life insurance application, even if it results in higher premiums.
Some potential policyholders may be wary of medical exams since they can be time-consuming, inconvenient, and invasive. Fortunately, no-exam policies let you skip the exam entirely. These policies tend to offer smaller death benefits and may cost more per dollar of coverage. However, with no medical exam, the application process is faster and more convenient. You might even receive the coverage you need within a day or two.
The best type of life insurance policy for you depends on your unique situation and coverage needs. Term life insurance’s large death benefit, low premiums, and limited policy term can suit this type of policy for parents with young kids who need temporary coverage. It can also help seniors who want to leave a legacy while saving on premiums.
Whole life insurance may work better for families who want lifelong coverage and have higher incomes and more complex financial needs. They may have the budget for the higher premiums and want to use the cash value to build more wealth. Finally, a small permanent policy like guaranteed issue life insurance can be a great option for those who want to skip the medical exam for guaranteed and low-cost coverage.
Buying life insurance for the first time may seem daunting, given the diverse range of policies available. However, understanding the basic features of a life insurance policy and knowing your financial needs and budget can help you narrow down your choices. If you’re ready to protect your loved ones but aren’t sure which life insurance policy is best for you, speak with an Aflac agent to explore your options and get a quote today.
1Investopedia – How to Choose Life Insurance. Updated January 2, 2024. https://www.investopedia.com/how-to-choose-life-insurance-7483886. Accessed March 28, 2024.
2Investopedia - 7 Factors That Affect Your Life Insurance Premium. Updated April 30, 2023. https://www.investopedia.com/articles/investing/102914/7-factors-affect-your-life-insurance-quote.asp. Accessed March 28, 2024.
Content within this article is provided for general informational purposes and is not provided as tax, legal, health, or financial advice for any person or for any specific situation. Employers, employees, and other individuals should contact their own advisers about their situations. For complete details, including availability and costs of Aflac insurance, please contact your local Aflac agent.
Aflac coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, Aflac coverage is underwritten by American Family Life Assurance Company of New York.
68000 series: In Arkansas, Idaho, Oklahoma & Virginia, Policies: ICC1368100, ICC1368200, ICC1368300, ICC1368400. In Delaware, Policies A68100-A68400. 65000 series: In Virginia, Policies ICC0965JTO & ICC0965JWO. B61000 series: In Arkansas, Idaho, Oklahoma & Virginia, Policies: ICC18B61JWO & ICC18B61JTO. In Delaware, Policies B61JWO, B61JTO. B60000 series: In Arkansas, Idaho, Oklahoma & Virginia, Policies: ICC18B60C10, ICC18B60100, ICC18B60200, ICC18B60300, & ICC18B60400. Q60000 series/Whole: In Arkansas & Delaware, Policy Q60100M. In Idaho, Policy Q60100MID. In Oklahoma, Policy Q60100MOK. Not available in Virginia. Q60000 series/Term: In Delaware, Policies Q60200CM. In Arkansas, Idaho, Oklahoma, Policies ICC18Q60200C, ICC18Q60300C, ICC18Q60400C. Not available in Virginia.
Final Expense insurance coverage is underwritten by Tier One Insurance Company. In California, Tier One Insurance Company does business as Tier One Life Insurance Company (Tier One NAIC 92908).
In AR, AZ, ID, OK, OR, PA, TX and VA: Policies ICC21-AFLLBL21 and ICC21-AFLRPL21; and Riders ICC21-AFLABR22, ICC21-AFLADB22, and ICC21-AFLCDR22.
Coverage may not be available in all states, including but not limited to DE, ID, NJ, NM, NY or VA. Benefits/premium rates may vary based on state and plan levels. Optional riders may be available at an additional cost. Policies and riders may also contain a waiting period. Refer to the exact policy and rider forms for benefit details, definitions, limitations, and exclusions.
Aflac WWHQ | Tier One Insurance | 1932 Wynnton Road | Columbus, GA 31999
Aflac New York | 22 Corporate Woods Boulevard, Suite 2 | Albany, NY 12211
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