The only type of life insurance available used to be term life insurance. This means that you paid a fixed price for the life of the contract and if something happened the beneficiary got paid. If your contract expired without the need of a premium, then they had to get a new contract and they got nothing for the money they paid in. Many consumers did not like this concept, so other types of life insurance became available. One type of insurance that many people consider is whole life insurance. There are actually six different types of whole life insurance, so have your pencils ready.

The first type of whole life insurance is called non-participating. With non-participating life insurance all premiums are considered at the beginning of the contract and cannot be changed. Second, is participating life insurance. With participating life insurance if there are profits in the policy then the insurance company will share those profits with the policy holder. The third type of whole life insurance is called indeterminate premium life insurance. With indeterminate premium, then your premium can change from year to year. One thing to consider with indeterminate life insurance is that even if the premium changes, it will not go over a predetermined amount.

The third type of whole life insurance is called economic life insurance. Economic life insurance is a combination of term life insurance and participating. When you purchase economic life insurance then part of the dividends are used to purchase additional insurance. Therefore the death benefits can go up or down. The fourth type is called Limited pay life insurance. With limited pay insurance, you only pay premiums for a specific number of years and then you're covered. The fifth type is called single premium. This policy could be cashed in but requires a large one time payment upfront. Some additional fees could apply. The final one is called interest sensitive wherein the interest varies for a cash value.

Whatever type of whole life insurance you decide will work for you, then make sure to do your research. With whole life insurance there are so many different kinds that it could be very confusing. You don't want to decide on one and then later find out, that wasn't what you wanted. If you do decide to purchase this type of insurance you would probably want to talk with a licensed insurance professional so they could explain everything more thoroughly and also answer any questions you may have.

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