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Assessing Your Florida Life Insurance Needs

Assessing your Florida life insurance needs is the first step when comes to shopping for Florida life insurance. It includes more than just coming up with a number for the death benefit, you must also decide on what type of Florida life insurance policy is right for you and the length of the policy. These considerations are a must for you to provide the best protection for those you leave behind.

 

How Much Florida Life Insurance

You are going to need to understand just how much Florida life insurance is necessary to take care of your family once you can no longer provide for them. There are several basic ways in which this can be done. Here are the three most popular methods.

  • Life Approach: This includes simply adding up what you expect your economic contribution would be over your expected lifetime. This total is then used as the Florida life insurance death benefit payout.

  • Needs Approach: This is a much more exhaustive and comprehensive process by which expenditures are reviewed, detailed and added together. These expenditures may include all of the following:

    • Day-to-day living expenses

    • Estate taxes

    • Education for children

    • Funeral expenses

    • Mortgage

    • Outstanding loans/debts

    These are only a few to get you started as any bills or foreseeable expenses should be included in this calculation. Once the amount has been calculated, then the value of the estate to be left behind is subtracted from this number giving you the Florida life insurance policy amount needed.

  • Rule of Thumb Approach: This is another simple approach (the simplest) in which you take your average annual income and multiply it by 10. If you have an annual income of $75,000 then you would purchase a Florida life insurance policy worth $750,000. It is a rough estimate to be sure and can easily lead to too much life insurance protection or too little.

 

How Long Do You Need Florida Life Insurance

The length of time for which you need Florida life insurance is also an important consideration. You may not need life insurance on a permanent basis, as your Florida life insurance needs will generally change over time.

Here are some things to consider to help decide how long you may need Florida life insurance.

  • Age of your children: If you have younger children, you will want to have Florida life insurance that will protect them all the way through their college years. If your children are older, perhaps you will need only a short-term life insurance policy until they have completed their education and left home.

  • Current and future debt: If you have debt, such as personal loans, car loans, that you expect to pay off within the next few years, you may not need as much, or any, Florida life insurance after 5 years. If you have long-term debt that will last until retirement or later, then you should consider Florida life insurance of a more permanent nature.

  • Value of your estate: If you are nearing retirement age, your children have left home and you have an estate with some value, you may not need Florida life insurance at all.

 

What Type of Florida Life Insurance

Once you have determined how much Florida life insurance you need and for how long, it is time to get the right Florida life insurance policy. There are basically two different types of Florida life insurance: term life insurance and permanent life insurance. Within these general types there are different policies that you can manipulate to meet your specific situation.

If you have decided that you will need Florida life insurance into your older years, past retirement, then you should consider a permanent life insurance policy. This type of policy does not expire until the death benefit is paid out.

If you have decided that you only need Florida life insurance for a shorter period of time, such as 5, 10 or 15 years, then you should consider term life insurance. These policies can be purchased for the period of time that you need and may expire without the death benefit being paid out. However, the premiums are cheaper and you will not be paying for Florida life insurance past the time for which it is necessary.

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