How to Get Life Insurance If You Are Self-Employed

Getting Life Insurance When You're Self-Employed

Getting life insurance when self-employed is usually simple and only takes time and research. You may obtain your insurance by applying online or contacting a rep directly, or you may contact a broker who might bring you multiple quotes from various competitors to consider.

Step 1: Determine How Much Life Insurance You Need

When choosing a benefit figure for your life insurance policy, consider your income and financial obligations, such as ongoing expenses, current debt, and potential future debt. For most people, calculating between 10 and 15 times their annual income might be sufficient unless you have younger children, multiple mortgages, or significant debt. You may need less if you have no children, grown children, or no mortgage.¹

Step 2: Determine the Length of Coverage

Next, determine the term you need the policy to cover. If you have younger children, you may want the policy to extend until their adulthood. If you are younger, you probably want to get as long of a term as possible. That way, you would still enjoy the lower policy rate when you are much older and still have coverage even if you end up with health problems as you age. If you are older and have most of your debts paid off, you may find a shorter term is sufficient for your needs.¹

Step 3: Put in an Application

Once you know what amount and term length you want in your application, get rate quotes from a few companies. If you are doing this yourself, you may want to use a site that puts your quote out to multiple companies or a broker that puts the request out to several insurance providers. Your financial professional may be able to assist you with getting quotes.²

Step 4: Compare Your Quotes

Once you have received your base quotes, compare the various amounts, terms, and costs to determine which option works with your financial situation. Once you have found the companies that work within your budget, research the companies. Check for reviews and Better Business Bureau (BBB) ratings to ensure they are a reputable company with no significant complaints against them.

Step 5: Complete the Application Process

After choosing your life insurance policy, you must complete the final application process. In most cases, this may include a medical examination, which the insurance company sets up either with an onsite medical professional or at a local facility. Most medical examinations consist of a medical questionnaire, a blood pressure check, a weight check, and a blood test. Once the results are received and are satisfactory, you may receive a change to your premium price. Then, a final policy is sent to you to be signed and dated. After that, your insurance policy is actively providing coverage.²