The Different Types of Life Insurance
If you have people in your life that count on your financially, life insurance is critical. If you are a single person without others depending on your money to live, than life insurance is likely not needed.
One of the most difficult times for a family is when either one parent or both parents die. The emotional heartache will be far worse if your dependents are left without money. If you are married without children and your spouse counts on you financially, having life insurance is a must.
Reviewing the information below about different types of life insurance policies will help in your decision making process.
Term Life Insurance- Term Life insurance is where you select the number of years you would like to be covered in the vent of your death. A 20 year term policy means that if you die within that 20 year period, your loved ones would receive a pre-selected amount of money. If the 20 years pass and you are still alive, the policy expires and has no value. The younger and healthier you are, the less expensive the monthly premiums will be. This is an excellent and reasonably priced policy
Whole Life Insurance- this type of insurance is available in a variety of options. The most important questions when deciding which option is best are how do you want the money invested and the length of the policy. Whole life insurance is considered a more traditional type as it locks in a fixed premium rate. It also involves investments of your money that may or may not be returned to the policy holder in the form of a dividend. If the market rises, your dividends will be higher. Your expenses will be fixed.
Universal life insurance Instead of flat premiums, you get to choose how much money you put into the investment arm of that policy. Although the carrier still determines when and how to invest the moneys, you can expect higher yield options to pay more in a bull market. Many such policies also include a provision that lets you apply your accumulated cash account against your annual premiums – a plus if you want your money to start working for you.
Each of the major permanent life insurance types allows for so-called “variable” iterations as well. For the most part, these offer enhanced flexibility in terms of the investment selections that will factor into the performance of your policy. Someone who is very knowledgeable of the stock market may want to have more control over the performance of their policy. This is a benefit reflective in this type of policy.
It is essential not to put off choosing a life insurance policy. Life is full of uncertainties. While you cannot predict when you will die, you can guarantee that the financial future for your loved ones will be secure. Shop around online and take into account both the type of coverage you select and how much it costs.