buying life insurance

A Detailed Guide to Buying Life Insurance

Life insurance is an important investment that you should buy. Unfortunately, only 46% of the US adult population owns a policy. Whether you’re a business owner or professional, if you’re one of these people, consider getting insurance now. Here is a detailed guide to buying life insurance.

Different Types of Life Insurance

All life policies are either term or pure coverage, or, said another way, whole life or permanent insurance coverage. Term life insurance provides death benefits. Whole life products have an added investment component along with their pure insurance or death benefit function. These policies build cash value over time.

Term Life Insurance

This policy has an expiration, lesser premiums, and quite straightforward. For example, you bought a 20-year policy at the age of 35. The expiration of this life insurance is at 55 years old (the policyholder).

In case you die before you reach the expiration, your beneficiary receives the benefit. The disadvantage is the chances of outliving your insurance. You may or may not receive the benefit, depending on the terms in the policy. Get this if you think you can live shorter than you expected.

Convertible Term Life Insurance

As the name suggests, you can convert the life insurance from term to permanent. This policy is convertible until you’re 65. After this period, you can’t convert the policy.

The premium is a little costlier than term insurance because you can convert it without medical examination as a requirement. Get this if you aren’t sure if you can outlive the expiration date of the term policy.

Permanent Life insurance

This policy is more flexible, doesn’t expire, and has similar benefits to a term policy. Another excellent component of permanent life insurance is its investment component.

You get the guaranteed cash value as promised on the policy statement. However, the premiums and requirements are stricter than the two types of insurance. You can’t negotiate the payments.

Variations of Permanent/Whole Life Insurance

  • Universal life insurance

This variation is more flexible and allows you to choose the premiums and computation of the death benefits. You can change or adjust the policy when your circumstances change, as long as you’re willing to coordinate regularly with your insurer.

  • Variable life insurance

You manage your investment portfolio that is connected to life insurance. Often the investment is a mutual fund. This policy should be registered in the Securities and Exchange Commission.

Policyholders need to be vigilant and watch out for any drastic changes in investment portfolios. Otherwise, you’d end up losing money on the investment side.


Anyone can be your beneficiary in CO Life Insurance. However, the most common one is your spouse if you’re married or your children if you have any.

You can update the beneficiaries on your insurance policy. So, make sure to keep an eye on changes and coordinate these with your insurance provider.

Insurance Premium

The cost of premium varies greatly, depending on the policy you’re purchasing. It’s best to talk to your insurance provider about this and see how you can come up with the best options. In the case of whole life insurance, the insurance premium may be separate from the investment option.

3 Facts You Need to Know Before Buying

Insurance is a great investment for business owners, families, or individual professionals. Here are some facts you should know first before making the final decision.

  1. Unexpected situations can happen.

You could say you don’t need life insurance right now. However, it would help if you kept in mind that unexpected situations happen. Today, you might have your business running. Tomorrow or months from now, disruptions can shut down your business, leaving you and your family to cope up with income lost.

  1. You’re Buying a Contract

A contract has requirements and states the things you need to know about insurance, from premium to benefits, from eligibility for reimbursement to exclusions. Even though your insurance provider explains what you need to do, you still need to read the fine prints.

  1. Insurance is still a commodity

Insurance providers’ main goal is to sell an insurance policy. Thus, they will put a lot of effort into convincing you to buy an insurance policy. Some will focus on selling one type of insurance. So, make yourself informed of these insurance policies. An informed buyer will make the right decisions.

Reasons You Should Get Life Insurance

  • You have a business and rely on it as your major source of income.
  • You have a family and have kids to raise.
  • You have an underlying condition.
  • You want a better retirement option.

The list of reasons can go on and on. Still, the final decision is yours to make. Whether you’re getting life insurance right now or years from now, understand what you’re buying.

About Mountainside Insurance Management

Mountainside Insurance Management, LLC is a multi-state insurance brokerage and management specialist. We are an independent brokerage and work with over 150 A+ carriers to secure comprehensive coverage for our clients. Our brokerage is committed to providing the highest quality insurance and risk management services at the most competitive premiums with hands-on services tailored to our customers’ needs. For more information about reducing your risk, contact us today at (720) 800-9495.