If you are looking to buy life insurance in Los Angeles for the first time, you probably have many questions in your mind. The truth is that like any other new experience buying life insurance for the first time can be a quite a daunting task. Here are five tips to help make the process smoother by eliminating unnecessary bumps and false starts along the road.
- Your Needs
People often feel the need to buy life insurance at some point in their lives, but you must never buy a policy only because you heard that it is a good idea. The purpose of life insurance is to provide financial security to families in case of the death of a parent or spouse. Life insurance is something worth considering if others depend on your income for support.
- Coverage Amount
The sum of money that your heirs or family will receive upon your death is known as a death benefit. To determine the right amount of life insurance you can use free online calculators. You can even use any number of formulas to get a ballpark figure. The simplest way is to take your annual salary then multiply it by 8. A more detailed approach would be to add up the monthly expenses your family is likely to incur after your demise.
Calculators and rough estimates might be useful, but they still cannot do some things such as providing any final answers. Calculators only help you perform hypothetical calculations. You still need to educate yourself on the inner workings of life insurance and various other financial products.
- Policy Type
Once you have determined the amount of coverage that you need, it is now time to think about the best policy type to meet your needs. You have two main options available to you: permanent life, which offers more comprehensive coverage or term life, which has more affordable premiums. However, the options available for you to explore are many.
- Insurance Provider
An insurance policy is only as good as the provider. It is important to choose an insurance provider that you can rely upon to still be around as long as you need coverage and one that invests premiums prudently to pay the claims of its policyholders without any delays.
- Consulting a Financial Professional
A competent Los Angeles financial planner will help you factor in your needs, the needs of your family, and financial considerations when making any decisions regarding your finances and the financial future of those that depend on you. Financial planners whelp you with various aspects of managing and allocating your estate such as wills, estate planning, etc.
The Bottom Line
Buying insurance in Los Angeles can be somewhat daunting for a beginner. However, with the right advice, you can make the best decisions regarding your financial future and that of your family. Follow the tips provided here to choose the best life insurance policy, coverage, and provider for your needs.
Thanks to our friend and financial advisor in Los Angeles, Samuel Rad, for his insight on important financial advice for buying life insurance. Sam is a Certified Financial Planner in Los Angeles and has a wide range of knowledge about personal financial issues. He has helped many people meet their financial goals.