Top Tips When Choosing Life Insurance

If you’re not married, then you might wonder what will happen to all your worldly possessions when you pass away. Do you have any savings to speak of? Any heirlooms or expensive items someone you love may benefit from?

Most importantly, do you have any debts such as a mortgage, credit cards, car notes, or personal loans? If the answer is yes to any of those, then it’s important that you know that all of your savings will be cashed out and possessions will be sold off in order to cover any debt that you have.

However, for those that may want to leave specific possessions to heirs (instead of having it sold to pay off debt), then life insurance may be for you.

Tips When Choosing Life Insurance

For those of you who want to purchase a life insurance policy just to cover yourself, there are a number of things you should do when choosing the appropriate cover. Here are some top tips:

  • Look at the options and prices from a range of different insurance firms. You could use online comparison tool to get a feel for the prices. Also consider visiting with an insurance broker as they’ll be able to shop the rates/options between a couple of different companies as well. Comparing life insurance coverage online will allow you to see what you can expect to pay each insurer which enables you to pick the cheapest or best valued policy available.
  • Determine the number of years you want the policy. While a 20 or 30-year term policy may be a great option for people, others my require something more complicated such as a universal life permanent policy.
  • Look at different types of life insurance. You could get a policy that covers you in the event of terminal illness, one that pays off the remainder of your mortgage or even a policy that pays out in installments to your beneficiary. The latter option may be ideal if there’s a son or daughter (assuming their older than 18) you want to leave your pay-out to as a parting gift.
  • Make sure you understand the price you’re quoted may not be what you receive. A common error I see when people shop life insurance is that they get quoted a better price then they’re actually eligible for. When life insurance is quoted, it’s often based on an assumption around your health. You may be quoted a very cheap rate because you were classified at a “preferred” rate (which means you’re healthy). However, that rating class and associated price are not determined until you go through the application process and the policy has been underwritten.

If you’ve yet to be responsible and protect your family from disaster, then I’d encourage you to shop life insurance rates over the next few weeks and get a policy in place ASAP!

Readers: what factors did you take into consideration when buying your life insurance policy?


  1. Pauline says:

    I don’t have life insurance other than basic coverage from my credit card. Having no kids or spouse I just made a will so far.

  2. We wanted to make sure we had the best coverage we could get. Although we don’t have any kids we do have a house and we are married so we wanted to make sure that either one of us would be ok if something should happen. We wanted to make sure that there was enough to cover the house, funerals and then some to take care of the person *s) left behind. Life insurance has branched out to include critical illness, disability etc now so it’s like a bucket of problems.. just make sure you pick one coverage or pick them all but everything in life is risk and it costs.

  3. Thad says:

    Great and timely information. The new year usually is a good time to take stock of your financial needs.

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