Term Life Insurance
Term life insurance is a policy that you purchase for a certain number of years. The rates are significantly lower than whole life insurance.
You can purchase term life insurance at varying amounts for a set amount of time. Common lengths of time include 5-, 10-, or 20-year policies. If you choose term life, you should self-insure by the end of the policy or plan on taking out a new policy. Remember, you should get a life insurance policy that will be able to support your family and would allow them to continue their same standard of living if something happened to you.
Term life insurance is generally the most affordable option and it may be the best option for your family.
Whole Life Insurance
Whole life insurance is a cash value policy that you purchase and keep for the remainder of your life.
You pay a premium for this insurance and it’s the more expensive option. Whole insurance is often sold as an investment because it has a cash value and you can draw out of it or borrow against the amount when you are still alive.
Other benefits of whole life insurance include a constant premium, lifelong coverage with no future medical benefits (if you do not make a change to your policy), and tax savings opportunities.
Other types of life insurance policies include universal life, a lifetime policy with some cash value; variable universal life insurance, another type of permanent life insurance with an investment portion that can earn you higher returns, but come with more risk.
Other Tips:
Your insurance may contact you about converting a term policy into a whole life policy, which should be avoided. In fact, you may want to switch your whole life insurance policy into a term life policy.
If you decide to change your life insurance policy, you will likely be required to undergo a life insurance medical exam, which you will need to “pass” to get the policy.
Choosing a life insurance beneficiary can be difficult. Consider naming a contingent beneficiary or a secondary beneficiary, and updating your beneficiaries throughout your life as your situation changes.
Term life insurance is a policy that you purchase for a certain number of years. The rates are significantly lower than whole life insurance.
You can purchase term life insurance at varying amounts for a set amount of time. Common lengths of time include 5-, 10-, or 20-year policies. If you choose term life, you should self-insure by the end of the policy or plan on taking out a new policy. Remember, you should get a life insurance policy that will be able to support your family and would allow them to continue their same standard of living if something happened to you.
Term life insurance is generally the most affordable option and it may be the best option for your family.
Whole Life Insurance
Whole life insurance is a cash value policy that you purchase and keep for the remainder of your life.
You pay a premium for this insurance and it’s the more expensive option. Whole insurance is often sold as an investment because it has a cash value and you can draw out of it or borrow against the amount when you are still alive.
Other benefits of whole life insurance include a constant premium, lifelong coverage with no future medical benefits (if you do not make a change to your policy), and tax savings opportunities.
Other types of life insurance policies include universal life, a lifetime policy with some cash value; variable universal life insurance, another type of permanent life insurance with an investment portion that can earn you higher returns, but come with more risk.
Other Tips:
Your insurance may contact you about converting a term policy into a whole life policy, which should be avoided. In fact, you may want to switch your whole life insurance policy into a term life policy.
If you decide to change your life insurance policy, you will likely be required to undergo a life insurance medical exam, which you will need to “pass” to get the policy.
Choosing a life insurance beneficiary can be difficult. Consider naming a contingent beneficiary or a secondary beneficiary, and updating your beneficiaries throughout your life as your situation changes.
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