A Guide to Buying Life Insurance

An affordable life insurance policy is vital to many people’s financial planning. A life policy can help provide for your family’s expenses after you are no longer here. While you can plan for your career and your family’s future, this can be disrupted by an unexpected death that can leave your loved ones with less or no income. 

Getting the right life insurance policy can be difficult. If you have outstanding debts, the sudden loss of your earning ability can burden those you leave behind. Life insurance can help you meet financial obligations when you are no longer here and provide peace of mind that your loved ones can pay for expenses into the future. 

Who Should Get Life Insurance?

Many people can benefit from getting the right life insurance policy. The right coverage can help children cope with bills and other expenses when their parent’s regular income is disrupted. Parents with children can use life insurance to give them greater peace of mind for their family’s future. 

But life insurance can also be a good buy for younger people looking to start families in the future. Because of how insurance is priced, younger people can get better rates when purchasing before they age. Often, the best life insurance rates are only available to younger people without health problems. Younger people aren’t the only ones who should consider life insurance. 

Even if you already have a family, the proper protection can help you plan for their future. If you have a mortgage or other debts, life insurance can help make house and other debt payments when your regular income is no longer available. This policy can help your family sustain their lifestyle even after you’re no longer here. 

Many types of financial planning, which include life insurance, are common, but some people have more complicated requirements. A life insurance policy can fund a trust set up to help make long-term financial decisions when you are no longer in the picture. Trusts are a great way to handle more complicated estate planning problems and can disburse money to family or charitable organizations. 

Trusts can also hold investments and help reduce your estate’s legal challenges. People with young children can benefit from a trust funded with the proceeds from insurance coverage. In the event of an unexpected death, a trust can help manage money for your children until they mature enough to handle financial matters independently.

How Much Life Insurance Coverage Should You Get?

The amount of life insurance coverage you get will depend on what you’re trying to accomplish. Do you want to replace your income, so your family isn’t harmed financially? If you have a mortgage on your home that needs to be paid off? Do you have young children who will be relying on you to pay for education costs? Consider all these things when deciding on how much coverage to buy. 

The most sensible way to plan for your family’s financial future is to decide how much money you’ll need to accomplish your goals. The right amount of coverage allows you to provide for your family, so they aren’t financially harmed when you are no longer with them.

Different Types of Life Insurance

Life insurance is complicated, with many different policies to choose from. An advisor can guide you toward the best option for your financial situation. Knowing some available choices will help you prepare to buy coverage. Every life insurance company has different products, but this list can help you understand the most common.

Term Life Insurance

One of the most affordable forms of life insurance is term life. This insurance offers protection during a particular term. Often this is 10, 20, or 30 years. A term life policy will pay out a death benefit if you pass away unexpectedly during this period. After the term expires, the policy is ended and won’t return any premiums which have been paid. 

Often term life policies are available in a fixed and decreasing term. A fixed-term policy will pay out the same benefit regardless of when an unexpected death occurs during the entire term. Decreasing term policies will pay a lower death benefit as the end of the period nears.

If you need insurance to pay off debts, for instance, a mortgage, decreasing term policies can be a good fit. This strategy makes sense as the longer you live, the more you’ll be able to pay off your debt and the less your family will need if you pass away unexpectedly.

Whole Life Insurance

Whole life insurance policies don’t expire like term policies and are active until the policyholder dies or stops making payments. Most whole-life policies will accumulate a cash value which can be accessed to pay premiums, borrow money or make a withdrawal. A downside to whole life insurance policies is expense: they are often much more expensive than term life.

Universal Life Insurance

Universal life insurance has a cash value like a whole life policy. The big difference is that this cash value can earn interest. Universal life insurance policies can be considered a combination of a life insurance product and investment instrument. There are a few different types available, and many companies offer custom products. Here are the most common types of universal life policies that you’ll encounter.

  • Guaranteed. A guaranteed universal life insurance policy offers a death benefit and has premium payments that don’t change over time. When purchasing this type of policy, you can choose an age when the policy ends. The higher the age you choose, the more you’ll pay in premiums.
  • Indexed. Indexed universal life insurance policies let you earn a fixed rate of return on the policy’s cash component. You can also link this policy to indexed equity and make a return matched to its rate of return. An indexed universal life policy is more of an investment instrument than other life insurance policies. Depending on which equities you select, these policies will increase and decrease in value.
  • Variable. This type of insurance allows the holder to invest the policy’s cash value through a separate account. These policies often have flexible premiums and can be customized with a level death benefit or an increasing death benefit.

Final Expense Insurance

Some seniors can benefit from final expense insurance, often named burial or funeral insurance. These policies pay a cash benefit to help with burial and other final expenses and can pay off some outstanding debts. The cash benefit is usually limited to $25,000 or less but can be a more straightforward type of protection for older people to afford.

Common Life Insurance Add-ons

While life insurance policies can cover many needs, you may have some special circumstances that can make your ideal policy slightly different from others. Many insurance companies offer add-ons that can customize protection to fit your life situation or unique needs. Here are some of the most popular add-ons that many insurance companies offer.

  • Accidental Death. An accidental death add-on can provide an additional death benefit if you die before a certain age. This plan can be a good add-on for whole life insurance policies, which function partially as investment instruments allowing them to have some of the benefits of term life.
  • Accelerated Death. This add-on allows a covered individual to collect a percentage of their death benefits while they are still alive if they’re diagnosed with a terminal illness.
  • Child Rider. This functions as a life insurance policy for your child and will pay a death benefit if they pass while your policy is still active.
  • Term Conversion Rider. If you want to convert your term life policy into a whole or universal one, consider this add-on if available. It can allow you to change your coverage during your term life policy period.
  • Waiver of Premium. People who are disabled or unable to work can have trouble affording their premiums. This add-on can help you keep coverage premium-free if you become disabled and unable to earn regular income.

Top Life Insurance Companies

When you are ready to buy life insurance, it’s best to shop around: different companies have various rates, and some may be a better choice for your current financial situation. Here are some of our top selections for reliable life insurance providers

Bestow Life Insurance

Simple, fast, and free from medical exam requirements, Bestow offers term life insurance for those who need it most: those in their prime earning years. Bestow makes getting term life insurance fast, with a simple online application process and quick approval. Affordable prices make Bestow ideal for younger adults who don’t need complicated life insurance protection. 

Bestow’s coverage amounts begin at $50,000 up to a maximum of $1,500,000. For people needing more than this level of protection, Bestow might not be the best choice. They only offer policies to adults 60 and younger. Older consumers with more complicated insurance coverage needs and people looking for whole-life insurance policies will need to work with another company. Extra insurance riders are unavailable, as are any whole-life policies. 

For younger people with simple insurance needs, Bestow can provide quick coverage with simple options that work for most people. Bestow doesn’t underwrite its policies but is a licensed agent that partners with North American Company for Life and Health Insurance®. To find out more about their insurance or get a quote, visit Bestow’s website at: https://www.bestow.com/quote/.

Fabric Life Insurance

Fabric Life Insurance is an online-only platform that makes buying term life or accidental death insurance quick and easy. Fabric’s accidental death insurance covers deaths resulting from accidents, excluding illnesses. Coverage starts at $100,000 and tops out at $1.5 million. If you are willing to take a medical exam, the maximum coverage available increases to $5 million. 

Fabric Insurance lets you apply for coverage from their website or via a mobile app available for Android and iOS. This coverage is open to people between 25 and 50 years old, ranging from $100,000 to $500,000. The mobile app has some great additional features and extras, including creating a free will, opening a savings account, or one of their college savings plans! The app lets you sync financial data with a partner or spouse, such as 401(k) retirement accounts. 

Fabric Life Insurance is one of the top choices for people looking for a quick, hassle-free online experience. To get a quick quote or learn more about how Fabric can protect your family’s finances, check out their website at: https://meetfabric.com/.

Mutual of Omaha

Mutual of Omaha is a great choice, especially if you’re looking for indexed universal life insurance. Their fee structure lets more of your premiums apply towards your policy’s cash value instead of being spent on internal administrative fees. 

Mutual of Omaha’s investments have been generally sound over the years, which can give you peace of mind when looking for a company to trust with your long-term financial planning. This company also has excellent financial strength ratings, so they are positioned well for the future. To find out more about their products and see if they are the right fit for you, contact them at their website: 

Pacific Life

For people interested in retirement planning, Pacific Life has fantastic plans that can build cash value. If you’re concerned about how far your 401k account will go after retirement, Pacific Life can give you extra confidence in retirement finances. Many of their products build cash value in the early years, which can help you meet financial challenges before retirement. When buying a policy, make sure you have a full understanding of the policy’s internal costs. 

Some of Pacific Life’s newer indexed universal life insurance products have higher internal costs and may not perform as well as those purchased in the past. To find out more, check out their website.


Protective is one of the best companies for stable financial backing and competitive rates. Their investments have performed well over the years, and the bonds and mortgages that underlie cash value have had an excellent performance. Internal policy costs are competitive for most buyers, ensuring that more of your premium is going towards cash value. 

Excellent financial management ensures that the company you purchase a policy from will be solvent when you need them. One downside to Protective’s policies is that many don’t accumulate cash value in the early years, making the products more suitable for people planning far into the future. Please find out more or get a quote from Protective at their website.

Lincoln Financial

Older buyers have less time to accumulate value, and Lincoln Financial has a range of products that can meet diverse needs. Depending on your risk tolerance, they have products with aggressive investments for cash value accumulation. 

Lincoln Financial has competitive rates and low internal policy costs, making them an excellent choice for careful shoppers. They also have safer products that will have lower returns but which have a lower risk. See how Lincoln Financial can help you plan for retirement at any age by contacting them on their website.


Prudential has a range of benefits that will appeal to seniors. Their term life product lets you access cash value from your death benefit if you need to cover nursing home expenses. Good financial strength combined with reliable policy illustrations helps prevent surprises throughout the life of your policy. 

While Prudential offers life insurance products to consumers in many different age ranges, their offers for seniors can help with their unique needs. Most of Prudential’s products have low internal costs, which means more of your premium payments go toward your policy’s cash value. To see how Prudential can help you plan for retirement at any age.

Life Insurance Policy Summary

A life insurance policy from a company provides a safety net for your loved ones if you die. It is designed to provide monetary help to your beneficiaries of the policy. After you are gone, your family must figure out how to cover the expenses you used to pay. There is also a need to prepare for the unexpectedly high cost of funeral expenses and possible medical bills.

If you are the primary family breadwinner in the household, you should consider talking to your insurance agent about adding an insurance policy. An insurance policy in effect before you die can ensure the family soon after you pass. It also gives them time to be able to figure out how to replace the lost income.

There are many different plans, and if you’re unfamiliar with what’s available, it’s easy to make the wrong decision. If you are considering getting insurance, we’ve put together this guide to help you understand what’s available and help you make sense of the many options. 

No article can replace one-on-one consultations with your financial planner, but this guide can help you know what to ask when making a life insurance purchasing decision.

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