5 Tips for Buying Life Insurance for the First Time

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With all of the options available, finding the right life insurance policy for your budget and needs can seem like a daunting task. However, finding your best-fit policy is easier – and more affordable – than you may expect. Read on for a few of our top tips for securing a life insurance policy that matches your goals.

Determine how much coverage you need

The first thing to consider when you are shopping for life insurance is the type of coverage you need – this includes your coverage amount (usually around 10 times the amount of your annual salary) and the number of years you want your insurance to last. Additionally, since life insurance protects your loved ones, you’ll want to think about what you want your policy to do for your loved ones if you were no longer around. 

Before purchasing life insurance, be sure to consider: 

  • How much money your loved ones (spouse and/or dependents) would need to maintain their lifestyle if you were no longer around
  • Any significant debt (mortgage, student loan, auto loan)
  • If you want to provide extra support for your loved ones, such as funds for a college education or a down payment on a home
  • If you would like to designate some of your policy’s death benefit to support your favorite non-profit  

Having a good understanding of your financial goals will help you decide which type of life insurance policy is best for you. If you want financial protection for a certain number of years, such as 10-20 years while your children depend on you financially, or a term of 30 years to cover your mortgage, a term life insurance policy might be a good fit.

If you want coverage that lasts a lifetime with added benefits such as cash value savings, permanent life insurance would better fit your needs.

Understand what affects your premium rates

Like any other type of insurance, your life insurance premium is based on your age, health, and lifestyle at the time you apply for coverage. Most life insurance applications will ask a few medical questions to determine your health status, but in most cases, you won’t need to go to a doctor for a medical exam to get covered.  

Term life insurance is one of the most affordable types of life insurance, with rates as low as one dollar a day. A pricier permanent life insurance policy would offer lifelong coverage and a cash savings component.

Adding riders to your policy could increase your premium rate but can expand your coverage to provide financial protection in the event of a critical illness or disability during your working years.

Consider your retirement accounts

Before shopping for life insurance, you’ll want to have a good understanding of your retirement accounts, such as a 401k, IRA, or other savings vehicles you are contributing to each year. Since life insurance is a form of financial protection, your policy can work alongside your retirement accounts to cover a mortgage, outstanding debts, or support loved ones if you were to pass away unexpectedly.

Determine if one policy is enough for your needs

For some people, purchasing several term life policies is a more affordable strategy to get the coverage they need when they need it most. If you need a certain amount of coverage that one policy cannot fully provide, you can ladder life insurance policies. Laddering means that you purchase several term life insurance policies and then set different term lengths for each.

Laddering life insurance can be a good option if you want one policy to cover your mortgage payments (such as a 30-year mortgage) and another policy to cover a number of years when you have financial dependents (such as a 20-year term when your children rely on you most). The ladder strategy can help you lock in lower premiums and can maximize coverage when you need it rather than paying for a policy when you no longer have the responsibilities you did 30 years ago. 

Laddering is not advised for everyone; if you don’t know what the future holds for your family, it is best to stick with one life insurance policy such as permanent life insurance, which can provide coverage for a lifetime. 

Don’t hesitate to meet with an advisor
Do you want to get an expert opinion before choosing a policy? Quility advisors are licensed specialists who can shop on your behalf to find your best-fit plan, so you can secure a policy in just a few simple steps. Your advisor can help you determine which coverage best fits your goals while finding the most affordable price on the market today. Getting advice from a licensed advisor can help you save money and get the perfect insurance quickly and easily.
Get coverage today to protect your tomorrow

If you already know which coverage you need, there is no better time than now to purchase a policy. You will get the lowest premium rate when you apply for coverage while you are young and healthy, so it’s a great idea to get a policy in place sooner rather than later. Our online application for term life insurance takes less than ten minutes to complete – let’s get started!

Let’s Get Started

If you are ready to get coverage now, our online application takes less than ten minutes.

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Calie Brummer
Head of Digital Communications
Calie Brummer is a staff writer and Head of Digital Communications at Quility Insurance with a focus on financial well-being and life insurance solutions.