Wednesday, April 4, 2007

Life Insurance: Tell Me About It And How It Works ?


Life insurance offers you an opportunity to ensure the financial

security of your family and loved ones, no matter what happens. Life

insurance can be used to:

* Pay off any final expenses or personal debts like credit cards, car

loans or a mortgage
* Offset the loss of your income for those who rely on you for

financial support
* Contribute to the future education of your children
* Protect your estate by helping to pay the taxes due on an estate

upon death
* Leave a legacy to your favourite charity

Who should buy life insurance?
The purchase of life insurance is often associated with major life

events like getting married, buying a home, or having children.

However, if these don't apply to you ask yourself the following

questions. If you answer yes to any of them, you'll want to consider

life insurance:

* Does anyone rely upon you for financial support? Whether it's a

spouse, child, grandchild, parent or dependent adult, life insurance

will help them protect their financial well being no matter what

happens.
* Do you have a mortgage, or any other debts? If so, a life insurance

policy can provide a way to take care of these outstanding bills along

with any others like funeral expenses, legal fees and taxes, and

medical expenses.
* Do you own a business?
o For sole proprietors, you're accountable for the debts your

business owes. If you do not have enough life insurance to cover

these debts, your personal assets could be liquidated to pay them off,

possibly leaving little left for your family.
o If you're in a partnership, a life insurance policy where the

other partner is the beneficiary means the surviving owner has the

cash easily available to buy out your portion of the partnership from

the estate.
* Do you want to leave a legacy? Life insurance policies can be used

to leave money to your favourite charity.

How much will life insurance cost?
There's no such thing as a one-size-fits-all insurance policy.

Insurance professionals need to look at a lot of different things before

they come up with a final insurance rate. They'll consider your age,

gender, whether you're a smoker, and your past and current health

record and family history. Then they'll balance all that with the

amount and type of policy that you're applying for.

What types of life insurance are available ?

There are two main types of life insurance, level life insurance also

known as term life insurance and decreasing life insurance or

mortgage life insurance.

Level life insurance as it suggests is level cover that stays constant

during the full term of the insurance and a level lump sum pay out

would occur upon death. The sum assured is decided from the outset

of the policy.

Decreasing is most often used to cover a mortgage and works exactly

the same as level life insurance however the sum assured decreases

over the term of the policy this is ideal cover for a mortgage or any

decreasing debts that maybe paid off over a period of time.


Life insurance is now more accessible than ever with the advent of the

internet. The best online brokerages offer instant online quotes, thus

avoiding any hard sell tactics the industry was associated with in the

past. A good example of this is Unbeatable Quote UK if you visit their

website www.unbeatablelifeandcriticalinsurance.co.uk you will find an

instant online quote with generous discounts and an online

application.

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