Like other cities, Phoenix, Az does not regulate life insurance the way state Departments of Insurance regulate other types of insurance like health, home and auto insurance. But some other provisions vary in location, from state to state about illustration requirements, free-look time frames, underwriting, and requirements for medical exams.
No one is exempted from the reality of death and the financial struggle of our families once we die. Buying life insurance policy service is one of the ways to help your family with the financial burden. You can protect the family you left by saving a part of your monthly income to pay for premiums to a life insurance company. When you leave this world in the future, the insurance agency will pay a lump sum of money to your beneficiaries.
What is Life Insurance Phoenix
Life insurance in Phoenix is a contract between you and your life insurance company. In exchange for paying your premiums, your beneficiary will receive death benefits after your death from your insurance agency in Phoenix, Az. Through this benefit, you can help your family with estate taxes and they can continue with their life with financial plan you prepared for their future.
Main Types of Life Insurance Phoenix
Term life insurance
In Phoenix, Az, term life insurance is the simplest type of life insurance policy that you can purchase. The insurance money that your family or beneficiary will receive from insurance companies when you die is a fixed amount. However, a term policy can only be used when the owner will die during the course of the term. It may not be a type of topic you would want to talk about, but getting a term life is a way of taking responsibility for your loved ones not to suffer when you are gone.
Permanent Life Insurance Phoenix
Permanent life insurance is more complicated than term life insurance in Phoenix because it provides two benefits to its policyholder. It provides death benefits and allows investment through accumulated cash value. This value of cash serves as savings account where you are depositing your money. It is money that you can access and borrow in the long term. The longer the policy you have, the more cash you can accumulate.
The major difference between term and permanent life policies is that permanent life policy does not expire, while short term only works for a period of time. It continues even if the policyholder dies or quit paying the premium. The sum your family receives, or how much is the value of cash depends on the policy that you availed. Permanent life insurance includes whole life, universal life, and variable universal life.
Whole Life Insurance
If you buy a whole life policy, you have to pay a premium until you want the policy. A part of the premiums goes into the savings and accumulates over the policy’s term. The longer you want to get covered, the more accumulated cash that you have. Since it provides two things, for the death benefit and growing a cash worth, you pay more for less insurance.
Universal Life Insurance
Similar to whole life insurance, universal life insurance has both a death benefit and a cash value. But unlike whole insurance life, universal life policy offers adjustable premiums. This insurance plan allows you to have access to cash to adjust the yearly payment. But you still have to pay the premium payment to remain covered. Other than that, you might be able to eliminate a premium payment based on how much value of cash you have.
Variable Universal Life Insurance
Like whole life and universal life insurance, variable universal life policy offers many things. It provides a life financial plan, a savings account, and a mutual fund that may get expensive. However, you may choose how to invest your savings. While for the mutual fund, you will be provided with dozens of various risk levels of stocks and bonds that you can choose. You will be presented with investment options for the savings with corresponding risks. So you have to bear in mind that insurance is about risk and who carries this risk.
How to Choose Life Insurance Coverage Amount in Phoenix, Az
To have a better estimate of how much coverage you need is to:
1. Sum up all expenses you want to cover, such as your income, mortgage, and children’s education and other financial expenses.
2. Subtract the amounts your family needs to pay for those expenses, like savings and existing life insurance.
The result will be your insurance requirement. It might be expensive, but life insurance quotes are free, so it does not hurt to price out your coverage needs. If it seems unaffordable, you can find and purchase what you can afford to secure a reasonable rate. You can buy more later but note that age and health conditions will be developing factors.
How to Get Life Insurance Phoenix Quotes
Based on the Insurance Barometer Report, some consumers think they cannot afford life insurance and often overestimate the price. But quotes are free, and they can request a quote from a life insurance company with the help of an insurance agent. Expect that the insurance agency will be asking about your age, health, vices like smoking, family health history, driving record, and other risky occupations and hobbies.
If you have decided on the quote that was given by the insurance agency you contacted, you can file a formal application. Answer the questions provided by the insurance companies in a more detailed way and apply for a specific policy type, price of insurance, and policy length. Once you have submitted your application, the insurance agency service might require you to undergo a medical exam. The time the application process takes vary depending on the life insurance company and the policy type.
Choosing The Right Life Insurance Policy By Age in Phoenix, Az
When it comes to buying life insurance service, your age and health are the main factors for the insurance company to determine your eligibility and the rate that fits you. But the younger and healthier you are, the more affordable policies are available for you. The typical age to get the best rating is in your 20s or 30s. The insurance agency is getting less risk when the policyholder is young and in good health.
Although affordable and high-quality insurance products are available to all age ranges, it is vital to get covered early to make sure you will have the most affordable when you have children or have a bigger financial responsibility. Get in touch with an insurance agent to request a quote.
Buying life insurance in your 20s
In your 20s is the best time to purchase affordable term life insurance. It is because the younger you are, the less risk you pose to the insurance company.
For example:
If you are a 25 years old in great health, you may purchase a 20-year $500k term policy for as low as $22.48 a month. If you have a one-year-old child at 25 years old, you have the coverage in place to protect your loved one if you will die through age 26.
Buying life insurance in your 30s
Most people at 30 are married, have their own house, have kids, cars, and plenty of bills to pay. This point is where life insurance becomes more important. Too many financial responsibilities but great health might be still on your side, and the best time to assess your new insurance needs. If you have already purchased your insurance in your 20s, it’s time to know if you need more.
Experts recommend that you buy a policy that is 5-10 times your annual income. Fortunately, sufficient and affordable term life coverage is still available in your 30s.
For example: If you are 35 years old in great health condition, you can purchase a 20-year, $500k term policy for as low as $20.32 per month.
Even if you already have life insurance, in the 30s is the best time to reassess your needs. Especially if you are earning more now and have a larger family, an online insurance calculator can help you find and compute how much coverage you need.
Buying Life Insurance in Your 40s
In Phoenix, Az, if you are uninsured or underinsured at 40, it is time to adjust your life insurance needs before the rates increase. If you are covered through work or your business, it is not enough. An individual policy can supplement what you have through your employer. Americans are living longer, and at 40, you might still have great physical health. Hence, policies are still affordable. At this age with excellent health, a 20-year $500k term policy can cost as little as $43.15 per month. If it is additional new coverage, a 15-year of $500k term policy would cost $42.29 per month. Ask help from an insurance agent and find more information about your insurance needs and the right policy for you.
Conclusion
Choosing a policy with a shorter term and a lower level of coverage can significantly save money while getting the appropriate policies. Besides your age, if you have loved ones who rely on your income or are financially dependent on you, purchasing insurance will take care of your family and will put them into security when unexpected things happen to you. As you have seen, insurance policy Phoenix, Az gets expensive as you age, so it is important not to put off buying coverage that you need if you want to be proactive and avail the most affordable rate.
