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Life Insurance

Life insurance is a policy that pays beneficiaries money when the policyholder dies. The most basic form of life insurance is term insurance. The policyholder pays a monthly premium for a specific term. The term is usually 10 or 20 years. If the insured person dies during this term, then a benefit is paid to the beneficiaries. If the insured person lives beyond the term, then the policy is cancelled. The premium for term insurance is inexpensive.

Whole life coverage costs more than term coverage, but whole life covers the insured for their entire life. It remains active until the person dies or stops paying the premium. Whole life also offers a cash value component. A portion of the premium is placed in an account, and can be taken out as a loan or used to pay the premium. And the cash that accumulates is tax deferred.
There is also universal life and variable life. Both provide coverage as long as the premiums are paid. And they also have cash accounts with a fixed or variable rate of interest.

Make sure to carefully review your options before purchasing a life insurance policy.






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