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Types Of Life Insurance

admin — Thu, 21 Jan 2010 10:14:12 +0000

Life Insurance is a form of life risk management or life cover that helps guard against the risk of a contingent loss of individual’s life. In general terms Insurance can be defined as the equitable transfer of the risk of a loss of Life and critical illness cover, from one entity to another, in exchange for a premium, and can be thought of as a guaranteed small loss to prevent a large, possibly devastating loss. Having a life insurance policy makes the insurance company agree to pay a sum of money upon the occurrence of the insured individual’s death or other event, such as terminal illness or critical illness. Every life insurance policy matures when the insured individual dies or reaches a specified age like 100 years. Life insurance may be divided into two basic categories – temporary life insurance and permanent life insurance which may be further broken into subclasses as term, universal, whole life and endowment life insurance. Temporary life insurance:This type of life insurance provides for life insurance coverage for a specified term of years where the premium buys protection in the event of death and nothing else. A policy holder insures his life for a specified term only. If he dies before that specified term is up, his estate or beneficiary receives a payout. If he does not die before the term is up, he receives nothing. Permanent life insurance:The type of life insurance in which the policy remains active until it matures unless the owner fails to pay the premium when due is called permanent life insurance. This type of life insurance is further divided into four main types:Whole life coverage: The whole life coverage ensures guaranteed death benefits, guaranteed cash values, fixed and known annual premiums, and mortality and expense charges that will not reduce the cash value shown in the policy in any way. Universal life coverage: Universal life coverage provides permanent insurance coverage with greater flexibility and ease in premium payment and the potential for a higher internal rate of return. Limited-pay: In such an insurance policy the premium pay periods commonly include 10-year, 20-year, and paid-up at age 65. All premiums are paid over a specified period after which no additional premiums are due to keep the policy in active. Endowments: Endowment Insurance is paid out after a specific period in either the conditions whether the insured lives or dies, In this policy, the policy cash value equals the equals the death benefit at certain age. In terms of annul premium, endowments are considered as expensive as compared to the other types of life insurance as the premium paying period is shortened.

Life Insurance – provides the most fundamental form of protection for you and your family.

Two Types of Policy: Term Life Insurance and Permanent Life Insurance

admin — Sat, 09 Jan 2010 01:29:39 +0000

A life insurance policy is mortality based insurance contract provided by a life insurance company. The life insurance policy guarantees death benefits to policy holder in the event of death. The life insurance policy has economic value on a human life.

This also can be referred as human life value. Thus, a life insurance policy is vital aspect in our life and it is required to safeguard financial impact in the event of death.

Think about a family which relies on both husband and wife for the income source to pay monthly bills, children’s expenses etc. In such situation, a life insurance policy on both the husband and the wife would be a good idea.

The business associates can also use a life insurance policy to purchase on another’s assets in the event of unexpected death of an associate. An important employee in a business whose death would cause financial danger with the company is often insured with a life insurance policy.

There are two types of life insurance policy – Term Life Insurance Policy and Permanent Life Insurance Policy. The term life insurance policy is for a temporary life insurance need such as the period of time during which children are in school.

On other hand, permanent life insurance policy provides lifetime insurance protection and does not expire until you pay the premiums. It accrues cash value and is designed for long-term or permanent needs. These types of policies include Universal Life, Whole Life and Variable Life.

The life insurance death benefit is generally paid in a lump sum however the beneficiary can choose to obtain the death benefit of life insurance in the form of an annual installment.

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Different Types of Life Insurance: Which One is Right For You?

admin — Thu, 07 Jan 2010 01:03:40 +0000

Life insurance is a great way to protect your family financially should anything ever happen to you. You may want to consider getting a life insurance policy if you are married, have children, or other people depend on your income for support.

There are a number of different types of life insurance policies available, and finding which one is the best for you and your family can be a challenge. Here are some of the different types of life insurance policies out there.

Term Life Insurance

Term life insurance is perhaps the simplest and cheapest type of life insurance available. This type of life insurance is considered temporary and provides protection for a certain period of time, usually 1-30 years. If the insured dies before the end of the term, his beneficiary receives the face value of the policy. If he does not die by the end of the term, he does not receive anything. At the end of the term life insurance period, you can choose to extend your policy or convert it in to a permanent life insurance policy. If you choose to renew, your life insurance premium will most likely go up. Most people argue that term life insurance gives you the most value for your money. You can compare free term life insurance quotes at ELifeInsuranceSaver. com

Whole Life Insurance

Whole life insurance, also called permanent life insurance, is basically term life insurance with an investment component that allows your policy to build cash value that you can borrow against. The investment could be in stocks, bonds, money markets, etc. Whole life insurance is very expensive because of the investment commissions and fees you are charged, and there is no guarantee that your investment will even make any money. As with term life insurance, your premium will be the same over the life of the policy. Three common types of whole life insurance policies are universal life, variable life, and traditional.

Universal Life Insurance

Universal life insurance is a form of permanent life insurance policy that combines a term life insurance policy with a tax deferred interest accumulating savings account. People that feel they need life insurance into their 70s and 80s would benefit from this policy because it allows adequate time for substantial savings growth. It takes a while for this type of policy to build considerable value, and you might not be able to save much in a shorter amount of time. If you feel that you do not need life insurance for that long, you should consider getting a term life insurance policy and finding another way to save for retirement and the future.

There are lots of different life insurance options out there. This is a very important decision for you and your family, so take your time. You can compare free life insurance quotes from various companies for different types of policies to see which one is best for you. The more research you do, the more knowledgeable you will be, and the better chance you will have at finding the perfect life insurance policy.

Michelle runs ELifeInsuranceSaver. com a site that allows you to compare life insurance quotes from multiple insurance providers by filling out one short form.