What is life insurance?
In a technical sense, life insurance is a contract between you—the policyholder—and an insurance company. A life insurance policy, however, can provide incomparable peace of mind that your family and loved ones are supported financially if anything were to happen to you. The two most common types of life insurance are term life insurance and permanent life insurance, but the type and amount of coverage needed varies from person-to-person.
At SelectQuote, we can help you figure out what type and how much life insurance is right for you. We work with some of the nation’s most trusted insurance companies and can provide coverage and cost comparisons in just minutes to help you find the right coverage with the right carrier at the right price for you.
Types of Life Insurance
The two most common types of life insurance are term life insurance and permanent life insurance.
Term life insurance is the most affordable type of life insurance. It’s typically a smart, straightforward choice for someone looking for a lower premium. Term life insurance provides added flexibility in that it allows you to choose how long you want to be covered.
Whole life insurance is a common type of permanent life insurance that provides lifetime coverage as long as the premiums are paid. Whole life insurance also includes a savings component known as a cash value, which policyholders are typically able to borrow funds from to help support additional financial needs.
Universal life insurance is a form of permanent life insurance that has a primary benefit of using the policy’s cash value to pay for premiums. The value accrues and earns interest as you pay monthly premiums, lending the opportunity to also act as a savings account.
3 Steps How-To Buy Life Insurance
1. Get a Life Insurance Quote
Before you get started shopping for life insurance, consider how much coverage you will need to replace your income now and in the future, such as education, family events, retirement savings, etc. Additionally, think about who depends on your income today—from spouses to children, business partners to loan co-signers—it’s important to consider everyone who can benefit from your smart decision to buy life insurance.
Getting the most accurate life insurance quote is all about providing the most up-to-date information. Individual and household incomes and debts, as well as your basic health history, will get the application started and the process often takes 15 minutes or less.
With SelectQuote, you’ll receive a side-by-side comparison of the best prices and carriers based on your age, health, family health history and lifestyle. Our life insurance coverage calculator can help you get started today.
2. Choose Your Life Insurance Coverage
After you complete a short questionnaire, we can compare and review prices from the trusted carriers we represent. If you are purchasing term life insurance, it’s important to carefully consider the timeframe needed for coverage. Remember: life insurance is most affordable the younger and healthier you are. It’s a wise decision to lock in what you think you’ll need to cover not only current, but future expenses.
After you see the insurance rates from the carriers we represent, select the best one for you and complete the initial application. Depending on the policy and carrier you choose, you may be asked to pay the first premium at this time.
3. Get Your Life Insurance Policy with SelectQuote
After your life insurance policy is submitted to the carrier, you’ll likely be required to complete a brief medical exam. This appointment allows the underwriter to confirm the details on your health questionnaire and finalize your price for the selected coverage. The more accurate your information is up front, the higher the likelihood of no changes.
The medical exam, though, is surprisingly easy. We’ll send a licensed medical professional right to your home to conduct a simple checkup comparable to what you’d receive in a doctor’s office (weight, height, blood draw, heart monitoring, etc.). You’ll receive a free copy of your lab results following your exam, which are completely confidential.
While each life insurance policy looks a little different, typically your coverage goes into effect at the time your application is received and/or after your first premium payment is made. Depending on what state you live in, you can have up to 30 days to return your policy and be fully reimbursed for any premiums paid.
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Start Your Free Life Insurance Quote Today
SelectQuote makes shopping for life insurance easier by comparing rates from multiple carriers at once. In just minutes, we can help you find the right amount of coverage at the right price for you.
How much life insurance do you need?
Determining how much life insurance you need depends on a few factors, including financial obligations like debt or mortgages, those who depend on your income, the cost of final expenses and other factors. We can help you calculate your life insurance coverage needs with our life insurance calculator. We’ll get to know you and your situation to determine how much coverage will protect you and your loved ones.
Life Insurance FAQs
How are life insurance rates determined?
There are a number of factors that help determine life insurance rates. The main components that impact the cost of life insurance are the type of life insurance policy, the amount of life insurance coverage, your age and gender, and your health and lifestyle.
What is term life insurance?
Term life insurance is one of the most affordable types of life insurance. As the name suggests, you have the option to choose your term length and only buy it for as long as you need it. The most common lengths are 10, 15, 20, 25 and 30 years.
What is whole life insurance?
Whole life insurance is a form of permanent life insurance, and as the name suggests, provides coverage for your whole life as long as you keep paying the premiums. In addition to providing a death benefit, though, whole life insurance also includes a savings component also known as the cash value.
Is life insurance worth it?
Life insurance is a fundamental aspect of your financial plan. The more people who depend on you and your financial support, the more important life insurance is. In the event of your passing, your life insurance payout can replace your income, helping your dependents cover expenses and continue to plan for the future.
Do I need life insurance?
If anyone else is relying on your income or your loved ones could be left with unexpected bills and payments if you were to pass, then you should be considering life insurance.
Is life insurance taxable?
If your life insurance policy is still active, your beneficiaries will receive the benefit for the full amount of your policy (generally in a lump sum or as an annuity). In most cases, these proceeds are tax-free, but if taken in installments, potential interest could be taxable.
Still have questions? SelectQuote can help.
At SelectQuote, we make buying life insurance from some of the most trusted companies quick, easy and at your convenience. We can answer any questions you have, match you with the best carrier for your lifestyle or health condition and find opportunities to save money and more.