When it comes to finding the best life insurance for you and your family, it’s important to understand all the components of the policy. In its simplest form, life insurance is a contract between an insurance company and an insured person. In exchange for making monthly payments, the insurance company promises to pay a sum of money to a beneficiary (chosen by the policyholder) in the event of the insured person’s death.
There are a few different policy types, such as term life insurance, universal and whole insurance. Once you know the policy you’re looking for, you can compare life insurance quotes from a handful of companies to explore all your options. Learn more about life insurance and see how it can benefit you.
If you’re shopping around for life insurance, make sure you understand the different types of policies that are available. There are two primary categories of life insurance:
- Term life insurance – the policy is only valid for a designated amount of time; you must pass away within the term in order to secure a payout.
- Permanent life insurance – the policy is valid for your whole life.
Within these two categories, there are several different policy options you can choose from. They are:
- Whole life insurance
- Universal life insurance
- Universal variable life insurance
- Group life insurance
Whole life insurance policies are the most common policies within the permanent life insurance category. It is one of the best life insurance policies for those who want coverage for their lifetime. They tend to cost more than term policies because they do not expire. As long as you pay your fixed monthly premiums (payments for having coverage), you will remain covered, and your beneficiary will receive a payout upon your death.
Universal life insurance is another type of permanent policy that offers an investment savings component. Unlike whole life insurance, you can use the cash value of your policy to help you pay your premiums. You can also choose a variable universal policy, which means your monthly premiums and the death benefit fluctuate depending on the stock market.
Group life insurance is a common employer-offered benefit. Your employer may offer term life insurance, whole insurance or universal insurance for free as part of your salary and benefits package. If you do not like the policy, you can buy supplemental life insurance instead.
Note that some life insurance policies require you to undergo a medical exam. The result of your exam can affect your policy rate, and, in some cases, may disqualify you from coverage. This depends on the type of life insurance as well as the company.
By Admin –
