The internet has revolutionised the way people buy new life insurance policies. In the past it was always argued that people don’t buy life insurance, they are sold it. This was at a time when a knock on your door was your first introduction to such an important subject. The door to door, or cold calling insurance agent wore his shoe leather out selling as much whole of life assurance as he could. Many agents became quite wealthy because of their successes. This still occurs in many countries.

The emphasis then changed to telephone sales where a team of salespeople sat at a number of telephones spending tedious hours calling numbers listed in a telephone book, the art of success being in making appointments for an interview. The life insurance itself wasn’t sold over the phone, the interview was. This saved a lot of the knock backs the foot slogging door to door salesman had to endure. Once again this type of selling life insurance still exists in some areas.

New Life Insurance Techniques

Many life insurance companies today sell the bigger part of their new life insurance policies through financial and insurance advisors, people who make their living giving financial advice on many subjects and in doing so represent many life insurance companies and financial organisations. The new life insurance policies sold by these groups are usually tailored to suit a customer’s particular circumstances, such as securing finance for a mortgage or large loan. Businesses buy life insurance in this way to insure their company against the loss of important directors and management staff. Much new life insurance is sold to bolster superannuation funds, both self managed funds as well as group and large industrial funds, where thousands of workers can have membership of the one superannuation fund that relies heavily on term life insurance to provide insurance on their members’ lives, should they die before their contributions to the fund have had enough time to grow to an adequate amount.

Much new life insurance is bought over the internet as this relatively new way of accessing all types of insurance has made it easier for many new life insurance companies to reach countless numbers of potential customers. They can list what they offer on an attractive web page and allow a potential customer to make contact with them for further information. Once contact is made the company then places them in the hands of one of their experienced staff, either over the telephone or by a personal visit to their home or place of work. Some companies will handle the whole application process online.

Types of Life Insurance to Choose From

No matter which way you go about purchasing new life insurance for your own purposes, the one thing that is common to all is that you must make yourself familiar with the basics concerning such cover. You can not expect to become magically covered by the right amount of life insurance when you are totally unaware of what you are getting yourself into. It is not complicated, it is not hard to understand but it remains amazing that many people still go about this very important process not knowing a thing about what they are doing. The first thing you must understand is that there are two basic types of life insurance and you should ask your insurer which type you are being offered. These two types are:

• Term life Insurance. This is the most basic and lowest priced of any new life insurance you may be offered. It is also called ‘pure’ life insurance because it is very similar to other general insurances you buy to insure your home or your car. With term life insurance you can purchase quite large amounts of cover for a very low premium, especially if you are still young, or at least aged under 45 years of age. You take out term life insurance on your life for a stipulated term. When this period of time expires, and you are still alive, you forfeit the premiums you have paid for the cover and the policy lapses.
• Whole of Life Assurance. This whole of life insurance includes an investment component built into its premium. This means the longer you have the policy in force the more its cash value builds. In this way you will always get some level of return whether you die and your beneficiaries are paid the amount you had been insured for, or if you were to surrender the policy prior to your death you would receive its cash value, your premiums plus any investment profit. This is not a good buy if you plan to use your policy primarily for investment purposes, but is a valuable added benefit to insuring your life and your family’s security.

Your choice of which type of life insurance you need should be discussed with your insurance advisor as the variables and features of your policy depend on your individual circumstances.

Your next concern will be the amount of new life insurance you need to purchase. This will depend on your age, status (whether married with a family and mortgage for example), your health, and reasons for wanting the cover. You will need little cover whilst still young and single, a large amount when married as you take on additional responsibilities and little again as you age and your responsibilities diminish.