Before you really start to shop for any type of insurance, you need to educate yourself on the very basics of what life insurance is and why you need to purchase life insurance for you and your loved ones.

Life insurance is defined by exactly what it says. You are taking out an insurance policy against either the loss of your life or a loved ones life. There are many types of policies out there and knowing what types of insurance that is out there is the key to making sure you do not pay too much.

There are three major types of insurance policies. There is whole life insurance, term life insurance and universal life insurance. There are many variations to these policies, but to sum it up, they all come back to these three major categories.  In order to purchase any type of insurance policy, you will need to purchase it from a licensed agent. If the agent is not licensed, do not buy anything from them. You can find out if they are licensed at your states life insurance board’s website. Also, if you find an unlicensed agent trying to sell you a policy, report them immediately to the state board.

You pay your premiums either monthly, bi-monthly, quarterly, bi-annually or yearly. The cheapest way to purchase your insurance is to pay yearly, as all insurance policies have built in costs for outstanding balances. However, you need to have insurance, so making sure it fits into your budget is also a crucial point to remember as well when buying life insurance.

Once you decide on the proper amount of insurance with your agent, you will need to fill out an application for life insurance. Now, this is a long process for some and a really simple one for others. If you do have prior medical conditions or existing ones, this will more than likely increase your premiums. If you have a serious or terminal illness, most companies will not insure you at all. Make sure you know what you are getting with your policy, especially if you have questionable health.

Once all the underwriting has been completed, you will get your policy either in the mail or in some cases, your agent will personally deliver it to you.