Life Insurance Should Be Part Of Every Family's
Budget
The financial security of a family can be protected with
an inexpensive life insurance policy. This means that if the
husband or wife were to die, or suffer a serious illness,
their loved ones would be provided for. Without life insurance,
the surviving spouse might have to work extra hours, children
might not be able to go to college or get an education and
the family could suffer a severe hardship.
Some policies provide more protection or different protection
than others. For example, coverage can include the following
insured events: death, disability because of a bad health
or accidental death. Some policies are designed to be both
insurance and an investment while others only protect the
insured for a limited amount of time. With all policies the
value is paid to one or more beneficiaries in the event of
the death of the policy holder. Many policies require that
a buyer submit to a medical exam to determine if any health
problems exist.
Types Of Life Insurance
There are three basic kinds of life insurance.
Whole Life Insurance
This policy is the traditional form of life insurance that
both provides death benefits and also serves as an investment
as the policy builds a cash value. Generally premiums of an
equal amount are paid at regular intervals and the death benefit
is fixed. The cash value can often be used as collateral for
a loan or be withdrawn.
Universal Life Insurance
This policy is a more flexible form of life insurance than
whole. They both builds a cash value and provides death benefits
but also allows the policy holder to change the death benefit
occasionally and to vary when the premiums must be paid.
Term Life Insurance
This type of policy is a low cost form of life insurance.
The policy holder is insured for a limited time, no cash value
accumulates, and the premiums may increase with the age of
the policy holder. Some term policies are renewable, meaning
that the insured does not have to submit to a medial exam
for renewal, but premiums may increase with the age of the
insurer.
How To Save Money With Life Insurance
Many financial experts believe that term life insurance coupled
with a retirement plan makes more sense than a whole life
or universal life insurance policy. The reason is that retirement
plans often grow at better interest rates than insurance.
Term life insurance can be quite reasonable today, costing
as little as forty dollars a month for a young spouse.
And while the cost of term insurance increases as a policy
holder ages, the need for insurance is less important for
an older couple with substantial assets and whose children
are grown and have gotten an education than a young couple
that is just starting out.
To get the best possible rate, compare policies from reputable
companies with the same coverage.
|
