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Life Insurance in Florida.
What You Should Know - Frequently Asked Questions.

Life Insurance protects what matters most: your loved ones. This F.A.Q. (Frequently Asked Questions) so you can be better informed and prepared when finding a good deal, both in terms of protection and price. If you are just looking for a life insurance quotes, simply click here.

Why do I need life insurance?

I am single, so why do I need life Insurance?

I have a good amount of assets to leave my children and loved ones. Life insurance is useless for me, right?

How much coverage is enough?

How much is a fair price?

Life insurance seems so complicated, there are so many types and options. What's this all about?

Will I have to take any medical tests?

How can I assign a beneficiary?

I only stopped paying for a week or so and I got cancelled. If I want my policy back is a lot more money. Why?

Why do companies care about my driving record, my hobbies and my lifestyle that have nothing to do with life insurance?

What can I do to get the best price in Life Insurance?

Do you have any useful Florida Insurance Links?




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Why do I need life insurance?

Life insurance is one of the most popular forms of insurance, and dates to centuries in the past. Once people understand what it is, its use is immediately evident. Life insurance, tu put it bluntly, is really "death" insurance. If somebody dies, the dependants of the deceased get a sum of money to cover the financial loss caused by the death of the insured. Is as simple as that.

So when do people get life insurance? Here are some common reasons why people obtain it:

-Parents protect their children (or any other dependants) in case of death, and cover for their financial needs such as food, housing, education and medical.
-Spouses and significant others protect their surviving spouse or partner in case of death, to cover their financial needs such as food, housing and medical.
-Business partners protect themselves in case their partner dies so the business can continue without, and cover expenses such as business shares purchase from the deceased ownership and income loss often resulting from a key employee or partner death.
-Life insurance can cover funeral expenses and debt for people without dependants so their family members are not burdened with them.
-It can also be used as charity, to leave behind financial support for somebody with special needs.

Now that you see why life insurance is essential, get a quote.

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I am single, so why do I need life Insurance?

Life insurance can cover funeral expenses and debt for people without dependants so their family members are not burdened with them, and it can also be used as charity, to leave behind financial support for somebody with special needs.

Another VERY important reason to obtain life insurance while single or younger, is because rates are MUCH lower when you are young. If you wait until you are old and sick to get insurance, it will be very expensive. People who are young and single often don't need life insurance at this very moment, but in most cases, they do in the near future, when they find a significant other, have or adopt children, or become key people in their jobs. Life insurance can in most cases be converted into permanent policies, and if you had your policy since you where young, your rates will be much better in this case.

Now that you see why life insurance is essential, get a quote.

 

I have a good amount of assets to leave my children and loved ones. Life insurance is useless for me, right?

This is a common misconception if not a big mistake. People often neglect to purchase at least a minimum amount of life protection thinking they can leave their assets to their children, and that's more than enough inheritance for them to go on. This is extremely unadvisable, since most of your assets are probably not liquid (meaning not cash) and your dependants are going to need cash to go on living and paying their bills and expenses. Not only that, but even if you have some cash in savings or investments, you should conserve that cash for its original purpose: savings, maybe for retirement, additional income, a vacation, etc, etc. Not as pocket cash for expenses that can be easily misused. You may disagree with these statements, but experience and reality shows that the inexperience of the surviving dependants often causes reckless or mismanaged spending of these investments or savings, that could have been much better handled if a death benefit had been provided to the dependants to go on living while better wealth planning for the inherited estate could have been implemented.

Now that you see why life insurance is essential, get a quote.

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How much coverage is enough?

There are many opinions in this subject, although one thing is crystal clear: you need to have enough coverage so your dependants can continue living without worries while they get back on their feed after the death and loss. How much is this? some people estimate it should be your income multiplied by 5 years (for example, if you make 50k a year, you should buy 250k of coverage). Some may say 5 years is not enough recover from a death, or is too long. However arbitrary this may seem, this gives you a good idea of what to aim for.

The prior method of determining your life insurance coverage is called the "Income" approach. There is also an "expenses" or "needs" approach, which basically adds up the expenses needed by the dependants (mortgage, utilities, food, education, etc.) and multiply that by the number of years needed to recover from the loss.

In case of business life insurance, the amount of money needed is going to depend on the use for the money. Is it going to cover loss of revenue while the business gets back on its feet and the key person who died is replaced? is it going to be used to buy the deceased share of the business? is it going to pay for something else? Add them all up, and that's the amount of coverage you need.

Now that you see why life insurance is essential, get a quote.

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How much is a fair price?

Prices vary greatly depending on your qualifications, which in Life insurance have to do mainly with your age, health as well as your habits. There are some policies that are as low as $20.00 a month for 250,000 in coverage for 15 years, and there are others that are as much as $100 a month for the same coverage. It really depends on your situation. The best way to know if you are getting a fair price, is to simply ask the agent directly: "is this a good price?" you will be surprised with the honesty of most answers, since agents have an ethical requirement of disclosure to clients. You can always compare rates when you get a quote.

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Life insurance seems so complicated, there are so many types and options. What's this all about? which one right for me?

You are right! Insurance IS complicated. That's why licensed professionals exist, and it's not so easy even a caveman can do it, like some say!!

Life insurance can roughly be divided in two major groups: Term (temporary) and Permanent. Term life insurance is simple pure insurance, like auto and home insurance. You pay, and if you die within a specified term, the company pays the face amount (coverage amount). If this term passes and we are hopeful you are still alive, then the coverage typically ends, and that's the end of it.

A permanent policy, can cover you for all or most your life, and it also allows you to actually SAVE some of the money you put in there so it can be loaned from the policy, withdrawn if the policy is cancelled or optionally add it to the benefit in case of death.

Normally the purpose of the insurance is to protect for an emergency, and the unexpected. It is not intended to profit from. However, some of the policies called permanent, universal or whole life policies allow you to supplement your income from investments or growth the cash you have put into the policy has. This is something to be very careful about, since at advanced ages, the cost of the insurance is higher, and some or in some cases all of these savings can be consumed by the cost of the company to insure you depleting the savings. This is why you should always have your agent review your policy to make sure you are in good shape.

This is not intended to be a comprehensive an all-inclusive explanation of all the products and benefits available. So Get a quote and speak to a licensed agent so you can get all the details of what's right for you.

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Will I have to take any medical tests?

In most cases, Yes, although some carriers offer products that don't require you to do so. This generally depends on the amount of coverage you are looking for, and the lower the coverage the lower the chances of you needing to take a medical test.

Even though you may not have to take a medical exam, providers will most likely pull your medical records and ask you health related questions which can still disqualify for coverage or increase your rates.

Start the process by getting a quote and speak to a licensed agent for more guidance on the subject.

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How can I assign a beneficiary?

This is usually as simple as calling your agent and signing a form indicating the persons you would like the death benefit to go to.

Some beneficiaries are irrevocable, which means that they can't be changed or removed. Also, life insurance policies can be owned by someone else different than the insured, and in most cases it is the owner of the policy, not the insured who has the right to change the beneficiary on a policy. A classic example with plenty of press of this is how Walmart not only owned several life policies on their employees, but also was the beneficiary on them receiving multiple death benefits upon the deaths of several of their employees. How can you know if your beneficiary is irrevocable on a policy you own? Call your agent, and simply ask this question directly.

Another common feature of death benefits is that they can be assigned to contingent and split beneficiaries, which simply mean that you can set the policies with conditions and percentages that specify how and how much to pay each beneficiary. For example, if the first beneficiary (the wife) is not alive, then pay the contingent beneficiaries (the kids), and divide the benefit 50%/50% for each one of them.

There may be more to the topic of beneficiaries, so speak to a licensed agent by getting a quote here.

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I only stopped paying for a week or so and I got cancelled. If I want my policy back is a lot more money. Why?

Insurance providers consider different factors when evaluating the risk they insure us for. One of those factors are the behaviors and habits of clients, since they have a direct impact in risk statistically speaking. When a policy is lapsed, this is considered to be a considerable indicator of greater risk, since a person who is not responsible enough to ensure their own property is continuously covered constitutes a higher risk than a careful one that always makes sure things are protected and in good order.

When a policy holder whose policy has lapses re-applies, he or she is often considered for a different kind of policy, since his or her qualifications have changed due to the lapse.

Not only this, but in life insurance, if you did not make a payment within the grace period, you will need to re-apply at a more advanced age and with potential health issues you did not have before. This is known as "re-underwriting", and it could work against your best interests.

Also, rates may have been adjusted for inflation or other factors that you were not penalized for when you first started your policy.

What you can do is simply get a quote to obtain replacement coverage now and make sure you are getting a fair deal.

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Why do companies care about my driving record, my hobbies and my lifestyle that have nothing to do with life insurance?

Insurance providers consider different factors when evaluating the risk they insure us for. One of those factors are the behaviors and habits of clients, since they have a direct impact in risk statistically speaking.

People may think that because they have great health, they are very safe to insure and this should not be held against them; however, statistical correlations exist between certain high risk habits and professions such as scuba diving, parachuting, law enforcement officers, etc,etc, and that is the reason why companies often want to know about these habits and lifestyles to determine rates, since they are on the hook to pay large amounts of money in case of death.

What you can do is simply get a quote to make sure you are getting a fair deal.

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What can I do to get the best price in Life Insurance?

Now that you are a little better familiarized with the factors that determine rates (health, habits, lifestyle) you are better prepared to obtain a better rate.

Medical issues are by far the most price sensitive factor. Things like being overweight, having conditions, high blood pressure and high cholesterol can drive your price up substantially, so be sure to take good care of your health by having good eating habits. Tobbaco products have also an enormous impact on the cost of your life insurance, even if you had quit 6 months ago or so, some test will still reveal it.

You have a great degree of control over the issues above, so you can give yourself time before applying for your life insurance. Debate may exist, but some measures you can take include having a glass of red wine each night one week before your exam can help lower your cholesterol (No, not a whole bottle, one glass per night), having a bowl of oatmeal each morning (skip the scoop of butter) for the week leading to your exam in addition to the red wine can significantly help in making sure your cholesterol level is better, skipping coffe for a day to improve blood pressure, avoid salt to improve blood pressure, Stay away from stress on the day of your exam. Even better, stay stress free for several days before, avoid alcoholic drinks for 24 hours before the exam, stay off the strenuous exercise or activity for 24 hours also, fast (no food) for 8-12 hours, drink plenty of water.

Some of the foods you can use are: Lean meats and fish, fruits, vegetables, home made beans, walnuts (in moderation), whole grain foods, fiber-rich foods. Avoid foods with high contents of saturated fat and simple carbohidrates (sugars). For best results, consult yoru doctor.

If you are ready, not it's time to get a quote.

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Do you have any useful Florida Insurance Links?

- Mainting a healthy lifestyle.
- Department of Insurance and Financial Service life Insurance Information.
- Office of Insurance regulation reports on Life Insurance Carriers
- AM BEST Insurance rating agency.
- Department of Financial Services Office of Insurance Regulation
- Insurance Consumer Advocate
- Talk to or contact a Florida Licensed Agent or Agency.

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