Monday, July 29, 2013

Common Questions about Florida Life Insurance

If you have never purchased a Florida life insurance policy before—or even if you already have a policy—you likely have some questions about certain aspects of your coverage. The following questions are those that are most commonly asked in regard to life insurance policies, coverage and more.

Do I need life insurance if I’m young and single?

Although you may not have a spouse or dependents yet, there are certainly some advantages to purchasing life insurance at this point. First of all, you will be able to lock in some very low rates. As long as you pay all of your premiums on time, you will be guaranteed insurability; this means that an insurance company cannot raise your rates over time due to illness, the birth of a child, marriage or any other life event.

How many policies can I have?

You can have multiple life insurance policies from different insurance companies and, in some cases, even the same company. However, if you choose to purchase multiple policies from the same company and the total value of these policies is more than what you would typically need, you should be prepared to answer some questions about why you want to purchase additional Florida life insurance.

What if I do not pay my premiums?

In the event that your premium payment is late, most companies will give you a 30- or 31-day grace period during which your coverage will not lapse. This varies from company to company, however, so you should be sure to ask your insurance agent about the rules for your particular policy.

What happens if my coverage lapses?

When you fail to make your premium payments before the end of the provided grace period, your coverage will lapse. If you have a permanent policy that builds cash value over time, you may be able to borrow enough against it to pay your premium before this occurs. If you have a term policy and you do not make your payment, the policy will lapse and your coverage will end. Future coverage may be more expensive due to your failure to make timely payments, as well.

Can I name anyone as my beneficiary?

When you purchase Florida life insurance, you will need to name a beneficiary—or a person who will receive the proceeds from your policy in the event of your death. This person can be anyone you designate, but special rules will apply to individuals who are under the age of 18. Similarly, you can name multiple beneficiaries and determine the percentage of the proceeds that each beneficiary will receive.

Can I buy a policy for someone else?

In most cases, you can only buy insurance for someone else you have an ‘insurable interest’ in that person. This means that there should be a valid reason why you would want to purchase insurance. In the state of Florida, this person must be your spouse, live-in companion, immediate family member, child or even business partner. You can also purchase life insurance for a child or a spouse without their knowledge.

If you have additional questions regarding Florida life insurance, a policy you have purchased or the amount of coverage you actually need, your insurance agent will be happy to answer these.

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