There are almost as many reasons to buy life
insurance as there are people. Everyone has different responsibilities.
Meeting those responsibilities usually requires money. Life
insurance, a contractual agreement between you and a life
insurance company, can guarantee that the money is there when
Life insurance was established to provide funds at death for
such items as paying final expenses and debts, and providing
an income for dependents. In the case of cash-value insurance,
living policyowners can benefit from their policy in terms
of disability coverage, annuity benefits and emergency funds.
Policyowners may also be entitled to dividends.
Buying life insurance can be complex because of the array
of options and types of policies available. Trained insurance
and financial advisors are invaluable in sorting through the
An advisor who is licenced to sell life insurance can help
you select the financial product that best fits your needs.
He or she will conduct a needs analysis that addresses your
financial situation, then will document current and future
goals to develop an individualized financial plan to achieve
those goals. As part of this process, he or she will thoroughly
explain products and options to help you arrive at an informed
Individual needs may vary and there is no single answer that
will suit everyone. While term insurance may be appropriate
to cover a short-term or temporary need, permanent insurance
or a mix of the two might better serve your needs. Your insurance
advisor can assist you in ensuring the appropriate type of
coverage is considered by taking into account personal circumstances.
Keep in mind that your level of life insurance coverage may
need to be changed as your circumstances and age change. You
should plan to review and update your policies every few years.
When you make an application for a life insurance policy,
with the help of your advisor, you must provide information
that is accurate, honest and complete. Otherwise, the payment
for a claim may be denied. In some cases, a medical examination
may be required.
When you receive the policy, it is to your advantage to read
it over very carefully and ask your advisor to explain any
points that are confusing. If you change your mind about your
purchase, most life insurance policies come with a money-back
guarantee called a "rescission right." Simply return
the policy to the insurer within 10 days of receiving it.
Any premiums paid will be refunded.
Buying life insurance can be complicated because of the many
options available. However, your life insurance advisor has
a full understanding of insurance and insurance products,
and can work with you to find the best insurance plan to meet
your needs and your budget.