ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Life insurance: Tips for first-time buyers

Updated on July 14, 2011

Making decisions when there are a plethora of options is no easy task. When it comes to life insurance, there are different companies, different plans and different levels of coverage. Faced with this difficult decision, many buyers opt for Route 1, without ensuring that it’s the best route.

First-time buyers should be especially careful, however. Life insurance is a long-term plan and should be bought with due care. A bad choice could leave you with buyer’s remorse or a plan that does not suit your insurance needs. However, getting to understand life insurance before you own a policy can help you make informed and prudent choices.

Understand your need

The first thing you should cover is whether you need life insurance right now. Some persons would argue that everyone needs it, but the reality is that some persons really need it, while it’d be a luxury to others. The role of life insurance in your overall financial plan should also be addressed. At this stage, you need to ask yourself the right questions:

  • How many financial dependents do I have, and what would happen to them if I passed away?
  • Would my financial, or family, circumstances change in the near future? (This is particularly important if you’re single and dependent-free now)
  • How would buying life insurance affect my financial plan (Would you still be able to afford sufficient medical coverage?)

The answers to those questions help you to determine the type of life insurance you need and how much coverage you should buy.

Estimate your life insurance needs

Buying too much life cover can be as bad as buying too little. Needs estimators allows you to determine the ideal coverage level based on your circumstances, finances and preferences. There are many free needs estimators online that would help you to get a ball-park figure. In estimating the coverage levels, it’s best to separate short-term and long-term insurance needs as well.

If you know a trusted and qualified insurance sales representative or advisor, you can also liaise with them to determine how much coverage you should buy. Avoid the insurance professionals who have self-interest at heart though.

Familiarize yourself with the life insurance options

There is a debate concerning the merits of term life insurance and permanent life cover. To complicate things even more, there are various types of life policies within each group. For instance, there are various whole life plans, several universal life plans and a number of term life options that you can choose.

Some persons would tell you that term is always better or that it is normally better to buy cash-value insurance. The most important thing is that you buy a plan (or plans) that suit your needs. Making comparisons between plans and among insurers can also make your final choice more appropriate.

Determine whether you need riders and which ones suit your needs

Riders are the informal term for optional supplementary benefits. Some life plans are robust enough that you can add a critical illness benefit or disability income benefit to them. There are many other “riders” that enhance the coverage, but the availability of certain riders may be subject to the plan that you choose. The most common rider among all plans is one that offers double indemnity for cases of accidental death.

Ask to see a specimen contract

The actual life insurance contract may be difficult for the average person to understand. They use a lot of life insurance lingo and legal terms that many persons are not familiar with. In addition, there can be several clauses and exclusions written in the contract – like non-forfeiture options, policy loans and provisions for reinstatement of the policy. You should be aware of these and clarify them with an insurance representative if possible.


Purchasing life insurance should be viewed as a process instead of an event, particularly for first-time buyers who should familiarize themselves with the concept. Sometimes it might seem tedious to do all the work beforehand, but it can save you thousands of dollars. Buying a bad policy is like flushing money down the toilet; it’s worth doing the research on the concept, the products and the companies.


Submit a Comment

No comments yet.


This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

Show Details
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)