Types Of Life Insurance

Thanks for visiting my website, which has been designed to provide you with short, clear and objective information on the various types of life insurance policies available. To be clear, this site is not about selling a life insurance policy to anyone. Rather the intent is to provide useful information that can be used to understand life insurance policies in general.

There are basically two general types of life insurance from which you can choose...term life...or permanent life. And within the permanent life category, there are several variations as explained below. Before seriously considering a policy, it's important to understand what these two basic types are and what types of life insurance coverage they are intended to provide.

The first type of life insurance, term life, is very straightforward. When you choose this type of coverage you pay for a specific duration of time. During that period, your chosen beneficiary receives the benefits of your policy in the event of your death. You should know that there are subcategories that fall under the category of term life insurance.

For example, you may choose an annually renewable term life policy. Obviously, this would be a policy you choose to renew (or not to renew) each year. Because the price of the policy and premiums may go up as you get older, consumers may want to choose to avoid the annually renewable term life policy in favor of something like a guaranteed level term life insurance policy. This type of policy stays the same price for a specific time period of time that can range from 5 to 30 years depending on what you've chosen. The newest type of term life is called ROP or return of premium term life insurance. It pays out the value to you at the end of the term if you are still living. If you die during the term the funds go to your beneficiary.

Permanent life insurance is the second type of life insurance. Permanent life insurance covers you for your entire life, and the premiums on permanent life are higher. Permanent life insurance has several variations from which you can choose.

The first type of permanent life insurance is called "whole life insurance". This type of life insurance policy covers you for your entire life rather than a specific term. A whole life policy will cost more on average and have higher premiums than term life policies, however, the investment potential and lifelong coverage are appealing to some insurance shoppers.

The second type of permananet life insurance is called "universal life" coverage. You can add your preferred amount to the minimum price of the premium. The insurance company then invests the funds with returns that are put into the premiums, or left to accumulate. One subcategory of universal life insurance is universal variable life which lets customers choose what they want to invest in rather than the insurance company choosing for them.

The third type of permanent life insurance is called "variable life". With variable coverage, you have more investment opportunities, which includes stocks. These types of life insurance policies are similar to universal coverage because the returns are either used towards premiums or allowed to accumulate in an account. Your beneficiary receives either the value of the policy, or the value of the policy, in addition to a portion of, or the full cash investment returns account.

If you need more help in choosing between the different types of life insurance policies available, please speak with a trusted insurance agent or you can do additional research online with the google search box further down on this page. Also note the additional category tabs to the left on this site, for other articles on life insurance basics such as Armed Forces life insurance rates, bad faith denial of insurance benefits, cashing life insurance policies in, and guaranteed issue whole life insurance rates.

Thanks for your time and I trust this information has been useful. Dan Jones

 

 

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