33 percent of Americans with life insurance feel they’re underinsured. They claim they bought the policy without fully understanding the terms. They believe canceling the policy would be too costly. So, what can you do to avoid this regret when planning to buy a life insurance policy in Virginia? After searching for “life insurance VA”, take time to learn the terms. Understand how each of them affects the policy. Keep reading to understand life insurance terms.
Policy Holder
The person who purchases the life insurance policy and pays the premium is the policyholder. They’re responsible for choosing beneficiaries and making changes. So, if you buy life insurance VA, you become a policyholder.
Beneficiary
A beneficiary is the individual(s) designated to receive the insurance proceeds at the death of the insured. In Virginia, you can nominate more than one beneficiary. You can even specify how the death benefit should be divided among the beneficiaries. If, as the policyholder, you don’t name a beneficiary, the insurance proceeds will go to the insured’s estate.
Death Benefit
The amount of money paid to the beneficiary by a life insurance company in case of the death of the insured is known as the death benefit. The main purpose of life insurance is to make sure that your family is financially taken care of once you are no longer there. The amount of the death benefit is determined at the time the policy is acquired and can either be a standard amount or a multiplicand of one’s salary.
Premium
The premium is the sum you have to remit in order to have your life policy in force. In Virginia, premiums can be paid monthly, quarterly, semi-annually, or yearly, according to the policy put forward by the insurer. The total figure that you pay as premiums is dependent on your age, state of health, and lifestyle, as well as the coverage chosen.
Cash Value
Cash value is a benefit of permanent policies such as whole life insurance and universal life policies. When premiums are being made, a percentage is absorbed into this cash value which increases with time. In Virginia, there is the availability of cash value to the policyholders in the form of loans or withdrawals with effects to the death benefits and tax exposure.
Lapse
In some situations, policy holders are unable to pay premiums leading to policy terminations, this is known as lapse. When it happens, they lose their coverage and policy benefits. However, most insurance companies do not cancel the policy after failing to pay a single premium. There’s usually a lapse period. So, after searching for “life insurance VA” find out about the lapse and lapse period.
Conclusion
Search for a reputable company in Virginia selling life insurance policies. The plan is to talk to their friendly customer service reps to find out more about the above terms. They’ll provide you with helpful information that you can rely on when choosing the policy to buy. The goal is to get a life insurance policy with affordable premiums that suit your needs.
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