Life insurance gives you and your loved ones the peace of mind that comes knowing that you are protected in case something unexpected happens. But how to know which type of life insurance works for you? Keep reading to learn more.
Which Type of Life Insurance Should You Choose?
Not all lifestyles are the same, so it makes sense to find different types of life insurance available on the market.
There are two basic types of Life Insurance: Term Life Insurance and Permanent Life Insurance. Here’s how to find out which one is right for you.
When to Choose Term Life Insurance
Term Life Insurance is the most common (and simplest) form of Life Insurance.
This policy pays only when death occurs within the term of the policy, which is usually from one to thirty years.
As you shop around for this type of insurance, you may want to ask if your policy is convertible. A convertible Term Life Insurance policy can be turned into Permanent Life insurance without having to undergo a medical examination (although the premiums tend to increase with the conversion).
Choose Term Life Insurance if your budget is limited or if you want protection only during a certain period of your life, for example, while you raise your kids, or while you pay your mortgage.
When to Choose Permanent Life Insurance
As its name suggests, Permanent Life Insurance offers coverage throughout your entire life, as long as you keep paying your premiums.
There are many types of Permanent Life Insurance you can choose from:
- Whole Life: Combines life insurance with a savings account, called cash value account. The death benefit and the premiums stay the same throughout the duration of the policy.
- Universal Life: Like Whole Life insurance, it incorporates a savings vehicle but it offers greater flexibility when it comes to premiums and death benefits.
- Variable Life: Combines the protection of a life insurance policy with a savings account you can invest in stocks, bonds, or other instruments. The death benefit and cash value will vary depending on the performance of your investments
- Variable-Universal Life: Combines the investment portion of Variable Life Insurance and the flexibility of Universal Life Insurance.
Choose Permanent Life Insurance if you want to be insured throughout your lifetime or if you like the idea of having a savings account you can eventually borrow against in case of an emergency.
RF1 Insurance Services: Life Insurance in Ontario, California
Looking for Life Insurance in Ontario, California, or anywhere else in the Golden State? Our friendly experts at RF1 Insurance Services stand ready to meet all your commercial and personal insurance needs.