5 Factors To Consider When Choosing A Life Insurance Policy


Given the unprecedented global health emergencies faced in recent years, many individuals realize how vital it is to have a life insurance policy nowadays. If anything unfortunate happens to them, the family or beneficiaries left behind will receive financial assistance to help them get by. It’s about securing their financial situation for the future in case the inevitable happens unexpectedly. 

The premise behind a life insurance policy is that through the regular payment of the premiums, you’re able to ensure your family receives the benefits they are entitled to upon your sudden death.  

Life insurance policies have their respective strengths and weaknesses, bringing in different factors that can help shape your decision when choosing one. This article clues you into some of the most important factors to consider.

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  • Reputation Of The Insurance Company

Before signing up for a life insurance contract and paying all the premiums, it’s a must for you to observe due diligence and study the background of the life insurance company you’re applying for insurance to. Life insurance premiums have to be paid for at least 10 years or so. That means you’ll need to find one with a long-standing history of stability. Otherwise, you might fall into the trap of a life insurance company that closes down due to mismanagement or loss of funds.  

A good life insurance company should have a comprehensive disclosure of its history and stability. Other important information should also include:  

  1. Policy structure, when given various life insurance quotes;  
  2. Customer service capabilities;  
  3. Scope of products.
  • Age

Next on this list is your age. It is one of the most vital factors to consider to help you decide which life insurance policies you’re choosing. 

The general rule as to age is the younger you are, the more options you can choose from. For instance, some life insurance products like basic term life insurance may no longer be eligible to those above 60 years old. 

And, the younger you are, the cheaper the premiums may be, too. If you’re reading this and you’re still in your early adult years, consider that an advantage. That should be an added push for you to go ahead and purchase a life insurance policy.

  • Premium Amount

One of the most significant figures for you to consider is the overall coverage amount. But this isn’t the only important number. Just as essential as that is the monthly premium amount. This refers to the monthly payments you’ll have to make to keep your insurance policy alive and valid. 

You shouldn’t ignore the premium amount as one of the factors to shape your decision because this takes a part of your overall monthly budget. You should choose a premium amount that’s affordable enough for you to pay every month.  

To get this amount right, it’s a must for you to calculate your monthly expenses. Only when you have a clear picture of those expenses can you ascertain how much you can comfortably allocate for your life insurance premiums without hurting your budget.

  • Beneficiary Name

Another factor you should bear in mind when choosing a life insurance policy is beneficiaries. Typically, insurance companies have a fixed determination or classification of who the allowable beneficiaries are in order of priority. 

You must also remember that when you’re listing beneficiaries of your life insurance policy, it’s important to avoid naming minors if your spouse is alive, anyway. Otherwise, your children may not receive financial assistance unless they reach the age of majority or legal age.  

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  • State Of Your Health

The last one on this list that’s also a major deciding element when choosing a life insurance policy is the state of your health. Most life insurance company providers will ask you to fill up a physical examination form or a questionnaire to assess your health condition. Be sure to state this. 

It means that the better your state of health is, the less expensive your life insurance policy will be. This fact is another reason why it should be a push for you to purchase a life insurance policy while you’re still young and healthy.

Please also keep in mind that your overall health will determine final rates.  As an example, life insurance rates for diabetics are higher compared to non diabetics.  Also, your premiums will vary as every insurance company has their own filed rates.


With all these health crises haunting us every day, you must consider purchasing a life insurance policy to ensure that you and your family get financial assistance if anything unfortunate happens to you. It’s not one for you to decide on or immediately sign up for on a whim. Insurance companies each have various life insurance products. So, if you don’t know what you’re looking for, it’s not surprising for you to feel overwhelmed at the options. To avoid falling into the trap of buying the wrong life insurance policy, consider the factors discussed above.