Many people in New Jersey do not have sufficient life insurance coverage. A significant number of individuals have no coverage at all, which can pose a serious financial risk to a surviving spouse and children in the event of the death of the income earner in the family.
In most cases, people avoid buying life insurance due to a lack of understanding of how to compare various policies offered by life insurance companies. It can be challenging to understand the difference between term, whole, and universal coverage. It is also a challenge to determine how large of a policy to have to ensure loved ones are cared for.
Working with a consultant to evaluate life insurance needs and review and compare life insurance companies is highly recommended. This will provide an expert opinion and analysis of the options available and the benefits or potential issues with the policy options and amounts.
Life Insurance Basics
Life insurance companies pay out the value of the policy when the insured dies. This is completed in a lump-sum payment to the named beneficiary or beneficiaries on the policy.
Term life insurance is coverage for a specified amount of time, usually between one and twenty years. There is no cash value for this type of policy. Whole life and Universal life policies are both designed to continue for the full life of the individual provided he or she makes all required premium payments. These policies will both build cash value over time. Universal life offers flexible premiums, a variety of pricing structures and various face value amounts, while whole life is fixed throughout the individual’s life.
Working with a New Jersey insurance specialist will be instrumental in determining the ideal policy and coverage amount based on your unique needs and financial situation.