POLICY TYPES LIFE INSURANCE COVERAGE
DEFINITION BUYING INFORMATION FAMILY TIPS INFO SAVING MONEY GUIDE STRATEGY
ADVICE PRACTICAL
IDEAS EDUCATION FREE ARTICLE
INFORMATION
Health
insurance policy types information.
TYPES
OF LIFE INSURANCE AVAILABLE
A life
insurance policy means many things to many
people. To some, having a life insurance policy
means that they’re thinking about adequately
providing for their loved ones should anything
unexpected happen to them.
To others,
having a life insurance policy means that their
home mortgage will be paid off should they
unexpectedly die. And, in a nutshell, that’s the
thing about life insurance – it really is a
general term that covers a multitude of
circumstances.
Looking at
the different types of life insurance available
more closely then, the following are some types
of life insurance to choose from to suit your
personal needs:
LIFE
INSURANCE POLICY TYPES
Whole Life Insurance Policy
Sometimes also known as “universal” life
insurance, whole life insurance is probably the most common of the life
insurances policies that you’ll come across. The policy is fairly simple –
it works on the basis of a basic permanent insurance plan into which you pay
periodic payments, most commonly monthly, and provides protection to your
beneficiaries over the course of your life. The downside of whole life
insurance policies is that the lump-sum payment paid out on your death is
calculated at the outset of the policy, and premiums are then calculated on
this.
As you may be able to see, it fails to factor in the increased wealth factor of
the insured and their loved ones as they get older and earn more money. Nor does
it include the additional expenditure they’ll be making as they buy bigger and
bigger (and more costly!) housing and cars. This is certainly one factor you
need to consider at the time of taking out the life insurance policy, or else
you’ll be forever “topping up” the policy with additional policies. The upside
of whole life insurance policies is that your premiums are fixed over the term
of the policy, and so it does make it much simpler to budget for this.
Term Life Insurance Policy
The significant difference between term life and whole life insurance policies
is that term life insurance policies factor in continued risk assessments. In
other words, as the risks in your life change, so does your policy. To account
for this, the premiums on term life insurance policies are also variable – so
that if you are considered a high risk, you pay a higher premium than if you are
considered a low risk.
Cost factors – which is cheaper and more
affordable?
When considering which of the two principal life insurance policies available is
the cheaper, you need to consider the following:
-
age: obviously, as you get older, you’re mortality starts to show itself
more than when you are younger. So, the age you are at the time you take out the
policy will factor in the cost of your premiums;
-
health: like age, health is an important factor in the risk assessment of
anybody looking to take out a life insurance policy. Included in the health
aspects of the risk assessment will be whether or not you smoke, are overweight,
do regular exercise, etc;
-
family history: with doctors telling us that more and more fatal diseases
are generic in nature, your family health history will also be factored into
your policy calculations;
-
driving record: may sound strange, but a background check is usually
undertaken to see if you have a poor driving record. If you do, expect to pay a
higher premium!
Finally both whole life and term life insurance policies require you to
undertake a physical check-up – and it probably this, as much as anything else,
which will determine the risk assessment.
To
teach and learn money skills, personal finance, and money
management, please go to the Money
Instructor home page.
Life Insurance Policy
Type for
Choosing life insurance
coverage
-
universal online lost
affordable save money
quote definition buying Teaching
and learning life
insurance - Insurance 101 -
Free Low Cost Online
Quote - Adults -
Education - Help - Practical
Classroom -
Learn Life Insurance
Policy Types Information
Health
insurance policy types information.
To
teach and learn money skills, personal finance, and money
management, please go to the