At first thought, buying life insurance as a college student might seem like an unneeded expense. But if you dive a little deeper, you’ll see that the right kind of life insurance policy makes a lot of sense.
Why Life Insurance Can Be Ideal for College Students
Life insurance is generally purchased for a few different reasons. If the policy holder were to die, the benefit payout could be used to:
- Help family make ends meet
- Pay for final funeral costs
- Cover debt
- Pay for younger family members’ college expenses
- Support a favorite non-profit cause
College students don’t necessarily see the point of life insurance for themselves. But the fact of the matter is that all of the options listed above can be motivation for even college students or their parents to buy a life insurance policy to cover the student:
- The benefits could be a great help to those left behind.
- Funerals can be very expensive and life insurance benefits could cover them.
- Any debt left from the college student’s student loans could be paid off.
- A spouse, child, parents or siblings of the college student could use the benefit to pay for any particular needs.
What Kind of Life Insurance Should You Purchase?
The two main types of life insurance are whole policies and term policies.
Whole Life Insurance
Whole life, or permanent life insurance, lasts for the holder’s entire life.
- It is more expensive to buy.
- Cost grows as the owner gets older.
Term Life Insurance
Term life policies are generally more affordable than whole.
- It is good for a set span of time.
- The policy can be renewed or cancelled when that time is up (in the event it is no longer needed).
How to Get Life Insurance
The first thing that needs to be done is determine how much is needed for the particular purpose for which it was purchased.
- Figure out how much debt would need to be paid off, or how much would be needed to pay off student loans.
- Pick a beneficiary, someone who will receive the benefit funds in the event of the policy holder dies.
If you apply to purchase life insurance you will need to provide the insurance company about your health history, your family’s health history, what you do for fun (is it dangerous?), any habits you have that could be detrimental to your health, and your job or volunteer position.
You’ll probably also be asked to get a medical exam. Note that no-exam life insurance is available but is the more expensive choice.
When all the details have been determined, shop around for the policy that fits your needs. You can simplify the process by starting with the eINSURE tool for getting quotes from a variety of insurance companies. Just answer a few questions and you’ll be provided the companies who fit. Or, if you’d rather talk with someone to start, call 1-844-EINSURE.