From a new baby to job loss, life is full of unexpected twists and turns. While some scenarios may be more challenging to prepare for, taking a proactive approach can still help. A comprehensive life insurance policy is an effective solution for creating a buffer against the unforeseen. If you're in the market for coverage, here are a few factors to think about before deciding. 

What to Consider When Purchasing Life Insurance

1. Coverage Type

Most life insurance policies have two choices: whole life and term life. With whole life, the policyholder can build up cash value in a plan. Once you reach a certain threshold, you can withdraw funds or take out a loan. You can use the funds for a number of reasons, such as paying for a child's college expenses. Term life insurance is available in several time frames, including 15, 20, and 30 years. The policyholder pays their premiums for the selected term, and if they pass away, benefits are paid out to beneficiaries. Some of the key differences between the two policies is term life doesn’t build cash value and you cannot withdraw or borrow funds.

2. Income & Expenses

When determining how much to secure, you should review your income, outstanding debt, and monthly expenses. In case the policyholder dies, there should be enough to replace their income to take care of a surviving spouse and any children. Life insurance also provides additional funds to help pay off mortgages, credit cards, and other forms of debt. The premise is to have enough coverage so family members aren’t financially burdened.

3. What's Not Covered

In most cases, life insurance carriers will not pay out benefits if the policyholder dies in an airplane crash, in military-related scenarios, including wars, and from suicide. To know exactly what's covered, an insurance agent can thoroughly discuss the fine details. While some carriers won't request a physical exam before securing coverage, others might require this if the person is a smoker or has a pre-existing condition.

If you’re ready to purchase a life insurance policy in Mebane, NC, contact Farm Bureau of Mebane-Caudill Agency. They are the area's go-to source for comprehensive and affordable coverage. Their agents are 100% committed to personalized service and accessibility. If you're thinking about a specific policy or reviewing an existing one, call (919) 563-3276 to talk with an agent. Visit the website for more information on their plan options.