Life Insurance
Term Life Insurance
Term life insurance protects your family for a certain period of time or term, and the owner pays an unchanging premium for the duration of the term coverage. If you die within that period of time, your family (the beneficiary) is paid the amount of the policy. The most common term durations are 10, 15, 20, 25, and 30 years. The applicant’s age will determine the availability of these products.
Other types of term insurance include:
- Annual renewable term (ART)
- Return of premium (ROP)
- Universal term life insurance
Universal Life Insurance
Universal life insurance is one of the two main varieties of permanent life insurance. Unlike term life insurance, a universal policy can be maintained indefinitely. Universal life insurance is characterized by its flexibility, transparency, and affordability.
Universal life insurance is an instance of cash value life insurance. "Cash value" is an interest-bearing account of real money. Its primary role is equity for your policy—at any time, the policy owner can cash in his/her policy and walk away with its cash value. Another use of universal life insurance is for tax purposes.
Other types of universal life insurance include:
- Variable universal life insurance
- Indexed universal life insurance
Whole Life Insurance
Whole life insurance requires fixed payments on a fixed schedule. These policies guarantee coverage up to a certain age (usually 100 years of age). These policies guarantee a death benefit, so even if the insured individual outlives the policy, a death benefit will still be paid. These policies carry cash value, which means that they can be liquidated.