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Checklist: Questions to Ask When Buying Life Insurance

By asking the following questions and conducting thorough research, individuals can make informed decisions when purchasing life insurance to protect their loved ones and financial security.

  • What type of life insurance coverage is offered (e.g., term life, whole life, universal life)?
  • How much coverage do I need to adequately protect my beneficiaries?

  • What is the premium amount for the life insurance policy?
  • Are premiums fixed or adjustable over time?
  • What are the payment frequency options (e.g., monthly, quarterly, annually)?

  • What is the duration of the policy term (for term life insurance)?
  • Is there an option to renew or extend the policy term?

  • What is the death benefit amount payable to beneficiaries upon the insured’s death?
  • Are there any conditions or exclusions that may affect the payout?

  • Are there any optional riders or additional coverage options available (e.g., accidental death benefit, disability income rider)?
  • What are the costs and benefits of adding these riders to the policy?

  • Does the life insurance policy accrue cash value over time (for permanent life insurance)?
  • Are there investment options or features available within the policy?

  • What is the underwriting process for determining eligibility and premium rates?
  • Are there any medical exams or health screenings required?

  • Is there flexibility to adjust coverage amounts, premiums, or beneficiaries over time?
  • Are there any restrictions or limitations on policy changes?

  • What are the options for surrendering or canceling the policy?
  • Is it possible to take out loans against the cash value of the policy?

  • If purchasing term life insurance, are there conversion options to convert to permanent life insurance without additional underwriting?

  • Who will own the life insurance policy (e.g., individual, trust)?
  • How are beneficiaries designated, and can they be changed?

  • What is the financial strength and stability of the insurance company?
  • Are they rated highly by independent rating agencies (e.g., A.M. Best, Moody’s, Standard & Poor’s)?

  • Are there any exclusions or limitations on coverage (e.g., suicide clause, contestability period)?
  • What circumstances could void the policy or result in denial of benefits?

  • What customer service and support options are available to policyholders?
  • Is there a dedicated helpline or online portal for policy-related inquiries and assistance?

  • Have you compared quotes and features from multiple life insurance providers to ensure you’re getting the best coverage and value for your needs?

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