Cheap Life Insurance: Experts Share Reasons For Drops In Premium Prices
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Cheap Life Insurance: Experts Share Reasons For Drops In Premium Prices
Taking out a life insurance policy is a wise investment, particularly for heads of families who have other individuals depending on them for financial support. There are a myriad of reasons why families should invest in life insurance; for instance, it can give dependents much-needed funds in case the family's primary breadwinner passes away unexpectedly. Although your loved ones will not be able to collect a monthly income as they have in the past, they would at least receive a large enough cash sum to help them live comfortably in the years after your passing.
In addition to giving income protection, a life insurance policy can be of considerable assistance in cases where homeowners are unable to pay mortgage, which is one of the biggest financial burdens that many families face today. Having insurance can protect families from incurring massive mortgage-related debts and losing their homes. Finally, life insurance policies can also be used to cover funeral expenses and inheritance taxes, making it easier for families to focus on other more pressing matters in the event of a loved one's death.
Despite the many benefits that having insurance can bring, many people are still hesitant to take out life insurance policies to protect themselves and their families, citing high premium costs as their primary reason. However, this is no longer the case; experts state that life insurance premium rates are actually dropping and becoming more affordable than in the past. The trend towards cheap life insurance, experts say, is brought about by two major factors: increasing competition in the market as well as longer life expectancy for policy holders.
Increased competition is evidenced by the continuous growth in premium income generated by the insurance market: in 2008, insurance companies generated $420.8 billion, which corresponds to a compound annual growth rate of 8.7% for the years from 2004 to 2008. This means that many companies now recognise the insurance market as a highly lucrative field of business and thus, more are actively participating in this market. Increased competition ultimately leads to cheaper rates for customers as more companies will create attractive deals just to get a larger share of the market.
In addition to increased market competition, another reason why insurance premium rates have been steadily dropping over the years is the increased lifespan of insurance holders. This is a significant factor in insurance premium prices because insurance policies for people with longer lifespans are more likely to reach maturity and have little risk of incurring claims against them.
Life has never been without risk, but there are ways to mitigate any difficulties that may arise from your passing. It is best to get cheap life insurance quotes from a trusted provider so that you can choose the right insurance policy to protect your loved ones for the years to come.
Article Source: http://EzineArticles.com
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