Life Insurance
WHAT IS LIFE INSURANCE?
Life insurance pays a death benefit if you die while the policy is in effect, in exchange for premiums you pay before your death. You can use the death benefit to protect against financial hardships such as loss of your income, funeral expenses, medical or nursing care expenses, debt repayments, and child care costs after your death.
COMPARE THE DIFFERENT TYPES OF INSURANCE POLICIES
TERM VS. CASH VALUE
TERM VS. CASH VALUE
Term insurance is intended to provide lower cost coverage for a specific period of time (“a term”). If you want coverage for a longer period of time, such as for your lifetime, cash value insurance may be more cost-effective. Most term policies don’t build up cash values that you can use in the future.
Term insurance is intended to provide lower cost coverage for a specific period of time (“a term”). If you want coverage for a longer period of time, such as for your lifetime, cash value insurance may be more cost-effective. Most term policies don’t build up cash values that you can use in the future.
WHOLE LIFE VS. UNIVERSAL LIFE
WHOLE LIFE VS. UNIVERSAL LIFE
Whole life and universal life insurance are two types of cash value insurance. A key difference between the two is how you pay for the coverage. You typically pay premiums for whole life insurance according to a set schedule. In a universal life policy, you can choose a flexible premium payment pattern as long as you pay enough to keep your policy in force.
Whole life and universal life insurance are two types of cash value insurance. A key difference between the two is how you pay for the coverage. You typically pay premiums for whole life insurance according to a set schedule. In a universal life policy, you can choose a flexible premium payment pattern as long as you pay enough to keep your policy in force.
VARIABLE LIFE VS. NON-VARIABLE LIFE
VARIABLE LIFE VS. NON-VARIABLE LIFE
The investments you will choose (such as stock and bond funds) in a variable life policy directly impact your cash value. These policies have the greatest potential to build cash value but also the greatest risk of losing cash value. Non-variable life policies often have guaranteed minimums for some features (interest or cash value, for example) but not all. Non-variable life policies also have less potential to build cash value than variable life policies.
The investments you will choose (such as stock and bond funds) in a variable life policy directly impact your cash value. These policies have the greatest potential to build cash value but also the greatest risk of losing cash value. Non-variable life policies often have guaranteed minimums for some features (interest or cash value, for example) but not all. Non-variable life policies also have less potential to build cash value than variable life policies.