Life insurance is something that everyone should consider investing in. Life insurance is not only a way to help your family with expenses at the time of your death but is also a way to plan for the future. Lets discuss different Types of Life Insurance and their benefits.
There are several different Types of Life Insurance. Of them only one is a policy that does not increase in value. This type of insurance is called term insurance. A term policy is set up for a limited time that can range from one year to several years, depending on the policy holder's need. In this type of insurance, whatever is paid into the policy is what will be paid out at the time of death. It is considered to be the least expensive life insurance policy.
The other policies in this article are polices in which both a death benefit and cash value account are provided. These Types of Life Insurance are whole life, universal life, variable life and universal variable life. The premiums on these Types of Life Insurance, are larger than those of term life.
Permanent protection is offered to the whole term life policy holder's beneficiaries. This type of insurance also builds in cash value. At the time of death, the beneficiaries are paid in full. Though the policy increases in value, ther premiums stay the same. The policy holder can withdraw cash from the policy, during their lifetime. With this policy the insurance company manages the various investment accounts.
If the policy holder wants an insurance policy where they have flexibility, then they should consider either a variable or an universal account. Like the whole life insurance policy, these Types of Life Insurance, pay the beneficiaries at the time of the policy holder's death. Both of them allow policy holder to borrow against the policy. However, unlike the whole life policy, both of these Types of Life Insurance allow the policy holder to take some risks as to where there money is invested. Of the these two, universal is more flexible that either whole or variable life insurance.
If the policy holder prefers to have more control over the cash value of their life insurance policy, then they should invest in a universal variable account. Like the other three Types of Life Insurance, mentioned in this article, it pays the beneficiaries at the time of the policy holder's passing. The difference comes in how the policy holder wants to invest their money, in order to increase the cash value of their policy. Like on the other policies the policy holder can borrow against the policy through out their life time.
