What is Life Insurance?
Why would you not have insurance on your most important possession? That’s you and your family! Having life insurance is important to have, for most individuals, yet, so many people do not have life insurance or if they do have it, they do not have enough.
If you have a car, you have to pay car insurance. If you have a house or apartment, you have to pay homeowners or renters insurance. As an individual medical insurance is important, but having life insurance is just as important to have for most individuals. However, there are some people that have enough money so they do not need life insurance, but again, that’s rare, most people do need life insurance.
There are different types of policies to choose from. However, no matter which type of policy in most cases, there are certain factors that will determine the price of the policy. The main factors are age, overall health and if you’re a smoker or non-smoker. Some insurance policies will do a medical exam and others will only ask health questions.
Types of Life Insurance
Term life – Term life insurance is just for a specific term. Policies range in how many years the term is depending on the insurance company and policy chosen, but the average is 10 – 30 year term. The coverage is in effect for a term of years that you choose. If you die while the term of the policy is in force, the insurance company pays death benefits to your beneficiaries.
Term policies are considered the most affordable type of life insurance but in some cases can be about the same or more expensive depending on age, health and other factors. When the term period ends, the insurance premiums will go up in price if you decide to renew the policy, due to the way prices as factored. There are also different variations of term life policy choices. Some term policies but not all term policies are convertible, meaning it can be converted to a whole life insurance policy.
Permanent Life Insurance Policies – Whole life insurance is a type of permanent policy, unlike a term policy, the premium stays the same the entire time you have it, as long as you do not let your policy lapse. Also, with a whole life insurance, you gain guaranteed cash value, which you can use.
Whole Life – Whole life insurance is a type of permanent policy, unlike a term policy, the premium stays the same the entire time you have it, as long as you do not let your policy lapse. Also, with a whole life insurance, you gain guaranteed cash value, which you can use.
Final Expense – Final Expense is a whole life insurance policy designed to pay off these expenses upon death and enables families to properly grieve their loved ones without the burden of large debts or unplanned costs. The average burial across the U.S. today costs approximately $9,000 – $10,000.
Final expenses are the costs that arise at the time of a person’s death. This includes bills associated with final medical expenses, funeral or memorial services, and the price of burial or cremation.
Universal Life – Universal life insurance is a permanant policy that combines permanent protection with an investment component. A portion of this account is used to cover the cost of insurance and any other monthly charges. The other portion represents your cash value. This can grow based on the interest accrued to policy.
Indexed Universal Life (IUL)
Indexed Universal Life (IUL)
There are different Indexed Universal Life options to choose from are subject to the terms of the insurance contract but they all have common features. Watch this video to learn more.