Life Insurance Provides Security
There Are Many Ways to Choose Coverage Levels
Some people base their coverage amounts on how much family income they’d need to replace over a specific span of years. For instance, a freelancer who has children who are 10 and 12 years old may wish to buy a policy equal to 8 years of income to get the kids to adulthood. Other people estimate how much coverage they need based on expenses over a specific span of time. Since freelancer incomes can vary, it’s important to think in terms of annual averages. This can help you ensure that you purchase enough coverage to keep your family safe.
Term Insurance Is Probably Your Best Bet
Life insurance is broken down into two basic types. The first is term insurance, which involves contracts for a set number of years at a specific price. The second is whole life, or permanent insurance, which allows you to lock in a set price permanently. The latter also functions as an interest-based savings account where you can borrow against the policy’s value. In nearly all cases, whole life insurance will be drastically more expensive than an equal amount of term insurance. Purchasing term life insurance means purchasing a product that offers a specific benefit: funds to cover your family in the case of your death or permanent disability. By focusing on this, you can get the best product for your money and your family.
