Life Insurance

Insuring Your Life & Protecting Your Income

Life insurance comes in two major types. The first is known as whole life insurance and it is designed to cover the insured for their entire life. It also has additional benefits beyond paying out money to beneficiaries if the insured dies. Term life insurance, on the other hand, is only for a specific term or period of time. At the end of this period of time, no more premiums will be accepted and your beneficiaries will not receive any type of death benefit.
Whole life is the best choice for most people, as it offers payout to the insured’s beneficiaries and also has an added benefit of building cash value for the person who is insured. It can be an essential part of financial planning and can come in very handy if there is a financial emergency. This type of policy stays in effect as long as the premiums are paid. When the policy holder passes away, the death benefits are then paid out the beneficiaries.
A whole life insurance policy will guarantee a certain payout when the insured passes. The policy holder makes premium payments that are the same from year to year. A term life policy premiums can increase, depending upon the age of the insured, which makes budgeting more difficult. In addition, if you leave the job where you received the policy or your term is up, any money that you paid into your term life policy will be forfeited, which is not the case with a whole life policy.
Money can be borrowed against a whole life policy if you need it, as it continually builds cash value. You can just withdraw the interest or you can withdraw all of the money. It is your money to use as you see fit. A term life policy will pay your beneficiaries the payout money that you pay premiums on, but will not allow you to borrow from it if you need money.
Whether you choose whole or term life, it is important that you evaluate the different policies to find the right one for you and your particular needs.