Post about "life insurance"

Life Insurance Comparisons – Understanding The Value of Term Life Insurance

When it comes to life insurance policies, there are several different categories of coverage. Some categories to choose from are term life, whole life, and universal coverage. Then you have the options of a return on premium riders and cash value build up. All of this can become very overwhelming when doing life insurance comparisons. Here we will try to help make your decision a little easier by explaining various different types of coverage for you to choose from.The first one we will compare is Term Life Insurance. This is the most common type of insurance and is commonly referred to as “temporary” coverage. You do not build any cash value with this coverage, and once you stop paying on it, your coverage stops. If you die, your beneficiaries will get a tax-free payout on the face value of the policy. Term Life is very popular with younger individuals. Some examples of this type of insurance are:Annual Renewable and Convertible Term Life – This type of policy automatically renews at the end of each one-year term. Usually the premium will increase each time it you renew it.Convertible Term Life – You will be able to transfer this type of policy to a whole life policy if you so choose and you do not have to start a whole new policy.Guaranteed Level Term Life – This offers a policy that has guaranteed levels of premiums and can be renewed without having to prove your insurability at an increasingly higher premium.Return of Premium Term Life – This type of insurance is unique in that it allows the policyholder to get a full refund on all premiums paid when the contract ends. This type of insurance can be quite expensive compared to regular insurance, but generally there is not an increase in the premiums throughout the term of the policy.The next one we will compare will be Permanent Life Insurance. This will provide coverage for your entire life and will stay active as long as you pay the premium or until the built up cash value is enough to pay the premium for you. The build up of cash value is the main difference between permanent life and term life insurance.Whole life insurance is a policy that remains in place for life. Differing from term life, the coverage will not expire, never has to be renewed, never be canceled, and the premium will not change. As you pay your premium, your policy will build cash value.Universal life insurance is much the same as whole life. The only difference is that with universal life it will break it down into 3 components of the policy, the death benefits, the cash value, and expenses. By doing this, it gives the policyholder more options as they age and changes will need to be made. But with these options, the policy can be more expensive than other plans.It is very easy to get overwhelmed when doing life insurance comparisons. Sitting down with an insurance specialist or a financial planner can help sort through all your options. Purchasing life insurance can be one of the most important things you will ever do for your family’s financial future.