As part of the agreement with life insurance, your insurance policy will be a monetary value, that you will in return, pay a monthly premium for. Do I Need Life Insurance
What Are My Life Insurance Options
Whole Life Insurance
This type of life insurance is similar to term life insurance, as well as provides cash value. Universal Life Insurance
This type of life insurance is a flexible kind of plan. Universal life insurance stays in effect as long as your cash value can cover the costs of the policy. Variable Life Insurance
This type of life insurance is designed for people who want to tie the performance of their life insurance policy to that of the financial market. As with whole life insurance and universal life insurance, you may withdraw against the cash value. Be reminded that withdrawals of this life insurance policy will be deducted from the cash value.
How Can I Save Money With Life Insurance
1) If you don't need life insurance, don't buy it. 2) Shop around for competitively-priced life insurance policies while you are healthy. 3) If you purchase a term life insurance policy, look for guaranteed and renewable policies. 4) Shop around and compare life insurance policy rates and coverage. There are thousands of life insurance companies to choose from.
Income replacement is the No. 1 reason people buy life insurance.
Policies are available from hundreds of life insurance companies in the
1) Assess your needed life insurance amount..
2) Look at ways to get the best possible life insurance rate.
Life insurance is a long-term proposition, so you should pay particular attention, at time of purchase and throughout the life of the policy, to the financial stability ratings of your life insurance company. Assessing your life insurance needsThe first step in life insurance planning is to analyze your life insurance needs - meaning the economic needs of dependents left behind. Because life insurance needs change over time, your life insurance amount should be reevaluated periodically. If the purpose of buying life insurance is to pay estate taxes, then you'll need permanent life insurance, which is in-force as long as you live and pay premiums.
Policy choices
Term life insurance, which provides only death protection without any side funds or "cash values" (offering the least expensive cost per $1,000 of death coverage purchased).
Term life insurance
Term life insurance is available for set periods of time such as 10, 15, 25 or 30 years. With "annual renewable term life," your policy automatically renews each year and premiums increase as you get older. Also available is "decreasing term insurance," where premiums remain level but your death benefit declines over time. Term life insurance is a popular choice because of the long rate-guarantee periods and because of the ability to get a low cost life insurance policy. Other policy provisions that drive the popularity of term life insurance are guaranteed renewal and guaranteed convertibility.
This feature may be of use in the future if you decide you want cash value life insurance.
If you'd like term insurance to cover you for a certain period of time but you're confident you'll outlive the policy, consider a "return of premium" (ROP) term life insurance policy. Term life insurance is widely available on the Internet, from direct-to-consumer life insurance companies and from insurance agents and brokers.Cash value life insurance
If you want more than a death benefit from your life insurance policy and like the idea of a long-term savings account (not insured by any federal agency) or stock market investment, you might consider cash value life insurance such as whole life, universal life or variable life. Cash value life insurance illustrations are divided into two major sections: guaranteed values and projected or "illustrated, non-guaranteed" amounts. Whole life insurance
Ordinary whole life insurance offers "permanent protection" with a cash value account that grows over time. Whole life provides a level death benefit and level premiums throughout your life and for as long as you continue to pay the premiums. If you have a traditional whole life policy, your beneficiaries receive only the death benefit no matter how much cash value you've built up.
Death benefit plus cash value
Death benefit plus return of premium
Whole life policies can be issued as "participating" or "nonparticipating." Nonparticipating whole life insurance offers no dividends.Buyers of whole life insurance like the certainty of fixed premiums with a known death benefit for life. Universal life insurance
This kind of policy offers greater flexibility than whole or term life. Some new universal life policies perform like term life insurance: They can be configured at the time of purchase to provide both level death benefits and level premiums that are guaranteed for life as long as you pay the scheduled premium.
Variable life insurance
Some variable life policies will guarantee a minimum death benefit.
Other permanent life insurance considerations
Your policy illustration will show you how long it may take for your whole life policy to be "paid up."
Riders add benefits
You can add riders to your life insurance policy that guard against a number of unpleasant situations.
How life insurance is priced
The life insurance buying process
- Simplified issue life insurance can be purchased after answering only a few medical questions.
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