While there are many different Types of Life Insurance, there are two common choices that the vast majority of people choose. These include whole life policies and term life. If you are considering purchasing life insurance it is important you fully research each of your options to make sure you get the coverage you need. This information will give you an explanation of the two most common policy types so you can learn more about what each offers. This will get you started on choosing your coverage type wisely.
Whole life insurance is also referred to as permanent insurance. It guarantees you are covered for your entire life as long as you pay your monthly premiums. This type of policy carries an added bonus that allows it to gain cash value. You can borrow against the amount of cash value in your policy or use this amount to make your monthly premiums should you become unable to pay them.
When you obtain a whole life policy you will make your monthly premium payments. Part of your premium is paid to cover your insurance and part is made towards an investment that gains interest. As you continue making your monthly payments, your investment continues to grow and is not taxed unless you choose to cash in on it. Since this policy offers so much in the way of coverage, payments are typically higher than with other Types of Life Insurance. Many people choose this type because of the investment it allows.
If you choose a term life policy, this means you are only covered for a certain period of time. The maximum term for this type of policy is thirty years and it does not build any cash value. You simply pay your premiums for the amount of the term and you are covered. This also covers you for a set death benefit. With this type of life insurance policy the premiums are much more affordable. This makes sense for those who are older and do not expect to need coverage for a long period of time.
To learn more about other options for life insurance contact the Strock Insurance Agency. They can help you through your purchase so you can get the best type of policy you can afford. Call today for an appointment so they can help you.
