subject: Availing of Term Life Insurance [print this page] Availing of Term Life Insurance
When speaking of life insurance, we can classify it into two broad categories. Term life insurance and whole life insurance each have their advantages and disadvantages that must be weighed when trying to determine which one is right for you. Life insurance is an important decision that can last for a lifetime and should not be made without careful consideration.
When deciding how much and what kind of insurance you need, you should keep in mind the primary purpose of the insurance. When one dies, his bills keep on living. For example, though you may will your home to a child, if the mortgage isn't paid off they will inherit that bill as well. Life insurance provides a fund source to take care of these things as well as other costs associated with death.
Term life insurance will upon your death pay a set amount to your benefactor. You make monthly or yearly premiums and in return the policy remains active. Should you die, the benefits are paid. A policy is agreed upon for a specified period of time. Once the expiration date is met, you must acquire a new policy. Since a policy is cheaper for young, healthy people, term life insurance is often the best type. Many of these policies have premium adjust rates that change every few years. As one ages, the premiums will rise. Many people find that a renewal guarantee is a good feature to have, meaning that the policy can't be refused renewal based off new medical conditions.
Whole life insurance remains in effect until the insured person dies, as long as premiums are paid and other conditions are met. Often, the insured can take out loans on this policy, depending on how much money has been paid into the policy. Since whole life insurance is not affected by health or medical conditions, unless a stipulation was made in the policy, it is often the best option for people as they begin to get older. By taking out a whole life policy when they are still healthy, they can negotiate a better price.
Life insurance is what we use to ensure our loved ones'financial well being after we are gone. If you truly love your family, you will sleep better at night knowing that at least financially your death will not affect them.
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