Are you planning to acquire a life insurance policy? If you are, you should know that there are two kinds of life insurance policies: term and permanent.
Getting a permanent life insurance policy is a good choice if you want an insurance policy that would last until your death. Otherwise, term life insurance policies would be good if you only want to cover a temporary need, such as your child’s education. Yet if you can afford it, getting a permanent life insurance policy might be the way to go, especially if you want an insurance that can be renewed when you’re over eighty years old, something that cannot be done with a term life insurance policy.
Whole life and universal life insurance are two types of permanent life insurance policy. These two types of permanent life insurance policy are especially different, because it allows policy-holders to invest. There is a limit to the investments with these investment options and beneficiaries, and in certain circumstances can receive payments, tax-free, in the case of your death.
Permanent Life Insurance Policy Video
Knowing the Difference between a Whole Life and Universal Permanent Life Insurance Policy
What’s the difference between the two types of permanent life insurance policy?
The premiums of a universal permanent life insurance policy can be divided into three parts: administrative costs, investments and mortality charges. A policy-holder of a universal life insurance policy will also have the chance to choose which investment options they can have with the policy. However, despite the choice, many insurance agents advise individuals not to obtain this policy if they don’t plan to build up their investments.
A universal permanent life insurance policy also gives policy-holders a choice to change their premium payments. For example, they can choose to pay the minimum amount for a certain period and deposit a higher one for the next.
A whole permanent life insurance policy is different in the fact that the policy-holder can’t choose where to put their investments. Whole life insurance has the same number and type of parts: administrative, mortality and investment. This kind of policy also offers holders the chance to pay the same amount of premiums for a certain period or until death.
You can choose to get a participating or non-participating policy. Getting a participating policy means the holder can get dividends from the life insurance companies. Many financial advisors recommend obtaining a participating policy, based on the present trend of favourable dividend rates.
About Us
The Hughes Trustco Group Ltd, life insurance brokers in business since 1972.
Get a Permanent Life Insurance Policy
To obtain permanent life insurance policy complete our permanent life insurance form and we'll provide a list of insurance quotes from all the companies in Canada.