Life insurance is important in any person or family's financial planning. It safeguards a family in case there is an accidental death. If a person has life insurance, he will be sure that his family will be financially secure even if he dies. There are different types of life insurance: Term Life, Whole Life, and Universal Life Insurance.
The Term Life
Term life insurance is an insurance product that covers you for a specific term (time period). You will pay the same rate over the life of the term, and you'll have specific amount in case of death. Most term life insurance policies are from one year to thirty years. Note that there are 2 types of term life insurance, which are the level term and the decreasing term. The vast majority of consumers choose level term. It has the same cost every year, while decreasing term means that the death benefit will decrease from year to year or by some other schedule. There is also renewable term life insurance. It's a good option since you can renew your life insurance when the term is up, even if you have additional health problems, which in normal cases you wouldn't be qualified for life insurance.
Whole Life/ Permanent
Whole life insurance pays a death benefit, whether you die in one year or at the age of 90. The benefit is the same no matter the time, and so is the payment. Some whole life insurance policies enable you to withdraw a cash value of the policy after a certain period of time. For instance, a person that no longer needs to care for a family with a whole life policy can withdraw a cash value of the policy in order to live more comfortably.
The Universal Life Insurance
This gives you more options as compared to whole life insurance. You have the option of increasing the benefit or withdrawing money from the policy if you want to.
Variable Life
It's quite alike with Universal Life Insurance, but you get a savings account that earns interest. You also get to invest money that is in the savings account through stocks, bonds, etc.
The Term Life
Term life insurance is an insurance product that covers you for a specific term (time period). You will pay the same rate over the life of the term, and you'll have specific amount in case of death. Most term life insurance policies are from one year to thirty years. Note that there are 2 types of term life insurance, which are the level term and the decreasing term. The vast majority of consumers choose level term. It has the same cost every year, while decreasing term means that the death benefit will decrease from year to year or by some other schedule. There is also renewable term life insurance. It's a good option since you can renew your life insurance when the term is up, even if you have additional health problems, which in normal cases you wouldn't be qualified for life insurance.
Whole Life/ Permanent
Whole life insurance pays a death benefit, whether you die in one year or at the age of 90. The benefit is the same no matter the time, and so is the payment. Some whole life insurance policies enable you to withdraw a cash value of the policy after a certain period of time. For instance, a person that no longer needs to care for a family with a whole life policy can withdraw a cash value of the policy in order to live more comfortably.
The Universal Life Insurance
This gives you more options as compared to whole life insurance. You have the option of increasing the benefit or withdrawing money from the policy if you want to.
Variable Life
It's quite alike with Universal Life Insurance, but you get a savings account that earns interest. You also get to invest money that is in the savings account through stocks, bonds, etc.
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