Choosing the right life insurance protection for yourself and your family in Oklahoma can be daunting. You don't have to wait to contact an insurance agent to learn more about your many insurance options. Read on to learn about life insurance types, quotes and cost; find out how to get life insurance coverage.
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Why Is Life Insurance Important?
Most people don't consider purchasing life insurance for themselves until they settle down and have a family. More and more people wait until they reach their 30s before they marry and have children. Thus, many of them forego years' worth of accumulated coverage.
In Oklahoma, life insurance takes on a new meaning when you consider the life expectancy of someone living in this great state is nearly seven years shorter than that of someone living in Hawaii. And with funeral costs only increasing, no one wants to leave their family wondering how they will pay for burial expenses. That's why so many Oklahomans opt for a life insurance policy to care for their loved ones at a time of need.
What Are Your Life Insurance Options?
Thousands of insurance companies on the market, some of them headquartered right here in Oklahoma, offer two broad coverage options: term and permanent life insurance.
Which type of policy you choose depends on your family’s needs. Term and permanent life insurance policies come in a variety of packages, each with its own stipulations and coverage options. It's best to work with a knowledgeable insurance agent to help you determine which is best for you and your family, but before you do that, be sure to learn their key differences.
What Is Term Life Insurance?
Term life insurance is available in two basic varieties from most Oklahoma insurance companies: level term and decreasing term. A level term policy, the most common type, pays the same benefit amount if death occurs at any point during the term; while a decreasing term policy pays less the closer you come to the end of the term.
You can renew term policies on a yearly basis, every other year, every five years and up to every 30 years. The most popular type is the 20-year term policy. Be aware that most companies will not sell term insurance for a term that ends past an individual’s 80th birthday.
Some term policies are convertible, meaning that you can change them into permanent life insurance without having to prove your insurability. Be sure to ask your agent about this feature, especially if you anticipate significant life changes in the future such as getting married and having children.
What Is Permanent Life Insurance?
Permanent life, sometimes called whole life insurance, pays a death benefit to your Oklahoma beneficiaries following your death – there is no age limit. There are three major types of permanent life insurance: traditional whole life, universal life and variable universal life, with variations within each type.
- Whole or ordinary life: This is the most common type of permanent policy. It features a death benefit and a savings account. With this type of life insurance policy, you pay a set amount in premiums on a regular basis for a specific death benefit (e.g., $300,000). The policy’s savings vehicle grows based on dividends the company pays to you.
- Universal or adjustable life: This policy provides more flexibility than whole life insurance. You may be able to increase the death benefit if you pass a medical examination. The savings vehicle, called a cash-value account, generally earns a money market rate of interest. After money has accumulated in your account, you also have the option of altering your premium payments if there is enough money in your account to cover the costs.
- Variable life: This policy combines a death benefit with a savings account that you can invest in stocks, bonds and money market mutual funds. The value of your policy likely grows more quickly but with higher risk. Some policies guarantee that your death benefit will not fall below a minimum level, which is an important caveat.
- Variable universal life: This type of policy combines the features of variable and universal life policies. You have the investment risks and rewards characteristic of variable life insurance, coupled with the ability to adjust your premiums and death benefit.
As a basic rule, if you want an investment tool with your life insurance, a permanent policy is the choice for you. If you desire only the death benefit, a term policy is the better option.
If You're Young and Healthy, Do You Need Life Insurance?
A tragic event can strike anyone, young and old, at any time. And if you're young, you'll save considerably on a life insurance policy versus waiting until you're older or have an illness. There also other things to consider when deciding the right time to get life insurance:
- Are you married?
- Do you have children?
- Are you caring for elderly parents?
- Are you the sole income earner in the household?
- Did you recently buy a house?
- Are your children ready for college?
- Are you in debt?
- Does your family have a history of heart disease or diabetes?
If you answered yes to one or more of these questions, you could use a life insurance policy to save your family or loved ones from having to carry unnecessary burdens after your death. Would your spouse be able to pay your debts? Will your children be able to afford college tuition? Would your parents have to enter a nursing home? The right life insurance policy will lessen these worries for you and them.
How Much Will My Life Insurance Quote Be?
The cost of your life insurance quote depends on a number of things. Oklahoma insurance companies consider several factors when calculating the quotes for your insurance policy. Let's consider the main variables used to determine the cost of permanent insurance first:
- Your age: The younger you are when you buy life insurance, the more affordable it will be.
- Your gender: Life insurance tends to be somewhat cheaper for females and more expensive for males.
- Your health: The healthier you are, the lower your risks are and the more affordable your policy will be.
- Whether you smoke: Smokers pay considerably more for life insurance. If you smoke, you can reduce your rates by quitting, although your rates will likely be higher until you have quit for at least a year or more.
- Your lifestyle: If you live a healthy lifestyle, your life insurance rates should be cheaper.
- Your family medical history: If your family has a history of heart disease or cancer, you may pay a higher premium.
- Your occupation and hobbies: Some hobbies and jobs incur more insurance risk. Someone who skydives on the weekends and patrols the streets as a police officer during the week will pay more than someone who knits and works retail.
- Your policy: The amount of death benefit you choose directly impacts the premium you pay.
- Your medical exam results: If your medical examination shows that your blood pressure and other vitals are in a normal, healthy range, your rates will be lower.
For term life insurance, most Oklahoma insurance companies not only consider the above factors in determining your premium, but they also take the following into account:
- The amount of coverage you want: Some people only want to cover end of life costs, while others want to provide for their family's ongoing cost of living in the event of their passing. A $10,000 to $20,000 policy will cover your funeral expenses and help pay any small debts you may owe. To cover loss of income and living expenses, college tuition and a higher debt pay-off, you might be looking at a $1-$2 million policy. Your term life costs will vary, accordingly.
- Length of the term: If you want your policy to cover a 10-year period, your term insurance premiums will be much lower than if you want a 30-year term.
Where Can You Find the Best Life Insurance in Oklahoma?
Now that you know a little more about the various types of life insurance available in Oklahoma, you may be ready to receive some quotes on various policies. When you contact a knowledgeable independent insurance agent from the Trusted Choice® network, you can be sure their years of experience will find you the best coverage at the most affordable price.
Contact an agent in your neighborhood for more information.