You'll want to ask about the basics of the policy, including how long the policy will last, what your premiums will be, what the policy's rate of return is and how the death benefit works. If you're purchasing permanent insurance, you should also ask about what kinds of benefits the policy provides while you're living, says Kim D. H. Butler, author of "Live Your Life Insurance."
"You're basically looking for four things: control, liquidity, use and equity," she says.
Control means the policyholder is clear on who owns the policy, who's funding it, who gets to decide the beneficiaries and whether the policy stays open or closed, says Butler.
Liquidity means the policyholder is clear on how much money he or she can take out of the policy and how fast. "You can get the cash value of whole life insurance within seven days," she says.
As for use and equity, Butler says policyholders should thoroughly understand what money taken from their account can be used for and what the rules are on borrowing against it if you need to take a policy loan.