Anytime someone is experiencing financial problems they usually first start to consider what expenses should be reduced or eliminated altogether. Their overall judgement can get distorted because of the stress they are under which can lead to poor judgement calls. This can be a very painful time for people and in a bad economy I see it more than ever. This article is going to be concerning why Term life insurance is more important than ever when you are in debt. Going through tough financial times is nothing to be ashamed of because millions of Americans are going through the same situation and the reason they are in debt is not their fault.
Let’s take a look at some of the most common causes that can place people in debt and financial jeopardy.
One of the most common reasons by far is when a person loses their job. This is very common today because many manufacturing companies have closed their doors in the United States to only re-open them in a foreign country such as China, Korea or Mexico. This can save the company money with lower productions costs but it will also contribute to the destruction of the job market in the US.
Some of the other causes may be a mortgage that has a high monthly payment, car payments, medical condition related expenses, divorce, legal expenses stemming from a divorce or criminal conviction and the list goes on and on. The end result is always the same where money becomes an important issue due to loss of income or added expenses.
Here is why your life insurance policy is so important at this point in time.
When you first applied for your life insurance you were younger and very possibly you were in better health at the time. These two advantages you will never be able to reproduce ever again unless someone invents a time machine. I have personally spoken with quite a few people that terminated their life insurance and then years later they wanted to purchase new life insurance to replace the one they cancelled. The first comment they make after their new life insurance is quoted is “why so much, it cost much less when I last applied”.
This is a standard response do to the fact they did not realize their new insurance would cost so much more after age increases and possibly a change in their health history. Here is a very useful example of how quoting rates increase which is naturally going to be based on your age. Check out these comparisons below:
Here is comparison of 20-year Term life insurance rates with a $500,000 death benefit in the Preferred Non-Tobacco rate class. We will review the rates for a 35, 45 and 55-year-old male applicant and see how age effects the premium. These are the top five most competitive premiums for all three age groups.
John Hancock – $316.00
Protective Life – $331.46
American General – $334.00
Lincoln Financial – $335.00
Banner Life – $336.49
John Hancock – $654.50
Protective Life – $700.44
Lincoln National – $708.50
American General – $709.00
Banner Life – $711.10
John Hancock – $1,568.00
Protective Life – $1,698.55
Lincoln National – $1,719.00
Banner Life – $1,719.01
American General – $1,729.00
If you compare the rates for the 35-year-old male to the rates of the 55-year-old male you will see an increase of 435%. Life insurance is based on age and that is why you want to hold on to your present life insurance policy for dear life.
Here are some good options for you if you need to get your life insurance premiums down.
If you contact your life insurance company and explain the situation they can help you lower your premiums by reducing your face amount otherwise known as your death benefit. A lower face amount is going to be better that no life insurance at all but still keeping your present life insurance plan design is going to be recommended. If you have a Term life insurance policy your term period can be changed to a shorter period of time. You can also keep the face amount exactly the same but just shorten the term period from 20 to 15 years just for example.
Just changing the billing mode can make a huge difference when money is tight.
Many people today pay their life insurance once a year which is referred to an annual payment. If you are paying your premium in one lump sum every year, you can change your billing to quarterly or monthly to break the payment up. This will actually cost you a little more money every year but it will make it much easier to pay your premium. This can make affordable life insurance even more affordable than before.
Most people that allow their life insurance to lapse regret doing this down the road.
If you have financial problems where you and your family are living from check to check, try all other options before you ever cancel your life insurance. If you would have an accident or become ill and pass away, the money situation that you are having right now would only be amplified. When there is no life insurance for your family, the effect can be immediate especially when there are many outstanding bills to pay and little to no savings left in the bank. This financial burden could easily fall on your spouse’s shoulders who would be in many cases responsible for paying your creditors.
Here is a list of some of the high-risk health conditions we work with where you can still obtain affordable Term life insurance quotes and rates.
Health conditions such as Heart Disease, Cancer, COPD, Diabetes, Hypertension, High Cholesterol, Lupus, Crohn’s Disease, Bi-Polar Disorder, Anxiety, Hepatitis C, Barrett’s Esophagus, Breast Cancer, Open Heart Surgery, Multiple Sclerosis, Sleep Apnea, Stent Surgery History,
Colon Cancer, Congestive Heart Failure, Strokes, Overweight/Obesity, Alcohol Abuse, Drug Abuse and many more diseases and conditions are handled on a case by case basis by the life insurance company underwriters. Also, life insurance for smokers is going based on the tobacco products used along with their frequency of use. Using the most applicable insurance company will be critical to receive the lowest rates possible.
When any one of these conditions are on your health history the life insurance companies look at the severity of the condition and how the condition is being controlled. Naturally more serious issues like heart disease and cancer are going to be considered more of a high-risk illness vs. being 25 pounds overweight or have a case of simple anxiety or depression.
If you are in good shape financially and want your dependents to remain that way, here are some tips.
Locate an experienced life insurance professional and have him or her shop the market for you so you can purchase low cost Term insurance with the lowest rates possible. If you have any medical conditions, you can have your agent pre-screen your health issues so you know what will be the best life insurance company to apply with so there are no surprises later after you apply.
Comparing Term life insurance quotes online will only take a few minutes of your time with the new modern life insurance quote engines. We work with over 40 trusted life insurance companies to make sure we are always getting the lowest premium possible for our life insurance applicants.
Complete the quoting for on the right to compare the best life insurance rates from trusted companies as Banner Life, Prudential, John Hancock, SBLI, Voya, Transamerica, Protective Life and many others. Take a moment to review some of the companies on our Top 12 Life Insurance Companies in America blog post.
If you have any questions pertaining to the subject of this article or applying for life insurance, don’t hesitate to call us. There is never any cost or obligation for our help. We are available 7 days a week to answer any of your questions. I hope this article helped answer some of your questions. Take care and stay healthy!
Here are the states in our service area where we provide free life insurance quotes and information.
Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, District of Columbia.