Types of Life Insurance Pt 4
There are three basic types of life insurance: term life insurance, whole life insurance, and universal life insurance. Whole life and universal life each use some of the insurance premiums to fund investments for the policyholder. These investments build a cash value, but require larger premiums than term life insurance. Term life insurance, however, uses the entire premium to buy insurance coverage. That is why term life insurance will provide more insurance for the same amount of money.
Term Life Insurance Explained
Term life is an insurance policy that provides life insurance for a year, or a set number of years, for a set premium. Term insurance does not build a cash value. Because term life only provides protection in the event of death it is just insurance and nothing else. There are no decisions required regarding investments or loans against the cash value. There are just three things to compare on a term policy insurance quote: the death benefit, the annual premium, and the amount of time the insured is covered. The benefits can remain level or change, the premium can remain level or increase, and term can be for one or more years.
Annual renewable term life insurance
The best type of life insurance may be annual renewable term life insurance. It is a one year policy that the insurance company will guarantee to renew at the end of the year regardless of the insurability of the insured. Rates for renewable term insurance policies start low, but then may rise over the life of the person. The policy is usually guaranteed to be renewable each year for a predetermined number of years. Depending on the policy this could be from ten to thirty years, and does not change even if the insurability of the insured does.
Renewable Term Life Insurance
Renewable term life insurance is a good choice for providing coverage of personal financial needs or responsibilities. If the insured should die before the term ends then the policy pays out to the estate or the beneficiaries. Caring for dependents, providing a dependent with money for college, paying off a mortgage, and paying for funeral costs are some of the reasons for buying insurance. These cost too much for most people to afford after the loss of the primary wage earner, but life insurance provides them with a solution, and annual renewable term life insurance will provide the largest benefits for the money.
Term Life Insurance Explained
Term life is an insurance policy that provides life insurance for a year, or a set number of years, for a set premium. Term insurance does not build a cash value. Because term life only provides protection in the event of death it is just insurance and nothing else. There are no decisions required regarding investments or loans against the cash value. There are just three things to compare on a term policy insurance quote: the death benefit, the annual premium, and the amount of time the insured is covered. The benefits can remain level or change, the premium can remain level or increase, and term can be for one or more years.
Annual renewable term life insurance
The best type of life insurance may be annual renewable term life insurance. It is a one year policy that the insurance company will guarantee to renew at the end of the year regardless of the insurability of the insured. Rates for renewable term insurance policies start low, but then may rise over the life of the person. The policy is usually guaranteed to be renewable each year for a predetermined number of years. Depending on the policy this could be from ten to thirty years, and does not change even if the insurability of the insured does.
Renewable Term Life Insurance
Renewable term life insurance is a good choice for providing coverage of personal financial needs or responsibilities. If the insured should die before the term ends then the policy pays out to the estate or the beneficiaries. Caring for dependents, providing a dependent with money for college, paying off a mortgage, and paying for funeral costs are some of the reasons for buying insurance. These cost too much for most people to afford after the loss of the primary wage earner, but life insurance provides them with a solution, and annual renewable term life insurance will provide the largest benefits for the money.
posted by Ivon T. Hughes at 10:00 AM
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