Below are some tips for reading your life insurance policy. If you have more questions, contact Leonard Financial Solutions. We can help you select life insurance in NJ that fits your needs and budget.
Cover Letter and Declaration Page
The first few pages of your insurance policy typically contain basic information such as the name of the insurance company, how much you will pay each month and the terms of the policy’s free look period, or the period when you can cancel the policy without penalty.
After the cover letter comes the first part of your policy, which is usually the benefits and specifications, otherwise known as the declaration page. This information should be familiar to you, as this is what you discussed with your life insurance broker in NJ. Here are some of the things you’ll find in the declaration:
- Benefit amount
- Amount of your payments
- Name of the insured
- Policy issue date
- Policy number
- Payment class
Insuring Agreement Section
The insuring agreement outlines the major details of your policy, such as what’s covered and your rights. For example, can you change the beneficiary? Can you borrow against your cash value? To help you understand what’s in the insuring agreement, it’s generally broken up into the following sections:
- Tables and illustrations show potential future premiums, cash value details and death benefits
- Definitions to help you understand your policy
- A settlements section that provides instruction on how a beneficiary can make a claim
- Endorsements and riders that can change your policy
Additional provisions may also be included in your life insurance policy. Provisions vary between policies. They’re based on the state insurance regulations, the insurance company and the type of policy you purchased. Your grace period can also be found in this section. If you miss a payment, most policies allow a grace period to prevent your policy from lapsing.
Hopefully this will help you better understand your life insurance policy. If you still have questions or are looking to choose a new policy, contact Leonard Financial Solutions for personalized solutions.