Best Life Insurance Companies in Columbia

Frequently Asked Questions

• Will your life insurance policy pay for your Columbia home’s mortgage balance in case you pass away unexpectedly?

  Yes, including the amount of mortgage you still owe in the life insurance policy you purchase in Columbia is one way to ensure your mortgage balance is paid by your policy. This way, your beneficiaries will have money to cover your final expenses, such as burial costs and the mortgage on your home. Alternatively, unlike life insurance, which can cover your beneficiaries' other financial needs, you can take out separate mortgage protection insurance that will only address your mortgage balance.

• Can your insurer automatically cancel your life insurance policy in Columbia if you missed one payment?

  No, policyholders in Columbia are entitled to a 30-day grace period following a missed premium payment under Title 31 of the Maryland Code of Regulations. During this time, the insurance company is not permitted to cancel your policy or withdraw coverage. This grace period allows you to pay the missed premium without jeopardizing your policy.

• Who has the right to take out a life insurance policy on your life in Columbia?

  Only people with an insurable interest or a substantial economic interest can buy life insurance on your life in Columbia. Blood relation or substantial love or affection generates insurable interest. So you, your blood relatives, and your spouse can all purchase a life insurance policy. Parties with substantial economic interest are those who would suffer a financial loss if you died, such as your business partner.

• Which death situations are commonly excluded from life insurance policies in Columbia?

  Suicide is not covered by almost all life insurance policies. Deaths caused by acts of war, military service, and aviation accidents are also common exclusions in Columbia. Some insurance companies also exclude deaths caused by dangerous activities such as skydiving and illegal activities such as DUI. Meanwhile, some life insurance policies only cover accidental deaths and do not cover illnesses.

• Will your beneficiaries receive the full cash value of your life insurance policy after you pass away in Columbia?

  No, even if the cash value of your policy exceeds the death benefit, your beneficiaries will only receive the death benefit specified on the policy. However, there are some whole life insurance providers in Columbia who will provide you with both a death benefit and cash value. Make certain to clarify this point before signing the insurance contract. It is important to note that any unpaid loans made against your policy will be deducted from your beneficiaries' payout.

• Which is better, term or whole life insurance?

  Life insurance is a personal financial tool, so the right type of insurance for you depends on your goals and current situation. One of the main differences between term life insurance and whole life insurance is that term life insurance only covers you for a set period of time. Once you meet the premium payment requirements on a whole life plan, it covers you for the rest of your life. Whole life insurance also builds cash value, making it a potential investment. But whole life insurance is typically much more expensive than term life insurance.

• How much life insurance do I need?

  A common recommendation is purchasing life insurance that is equal to five times your current salary, or more. But you can also estimate how much life insurance you need by adding up your debts, annual expenses for dependents multiplied by the years you want to ensure support, and any other items you wish to cover, such as a future wedding or college tuition.