Life Insurance Types ? What Do You Choose?
If you are confused as to what you need to do to secure the future of your family, in case you pass on and are contemplating on life insurance schemes, you have come to the right place because, we will be discussing in detail, what are the different types and what each can offer you. This will sure get your problems solved by providing you with solid grounds to think on.
There are basically two types of life insurance schemes which are the temporary and permanent schemes. The temporary term life insurance is for a specified amount of years with a previously understood amount as premium. This does not accumulate any value for the cash but only provides protection on death. There are no other facts or situations that are considered. This means that if the death has not happened, then you do not receive anything.
The permanent life insurance on the other hand, lives till the end of the policy time when it matures. The cash value is increased and as a result of this the company also does not face loss under any circumstances. The most interesting fact is that you can access the money anytime, by borrowing in accordance with the cash value or by completely surrendering the policy when required. There are further divisions that exist here such as whole life, universal, limited pay and endowment life insurance schemes.
The whole life insurance policy is something that provides a premium of a particular level and a cash value is included. You could look at the premium amount and the cash value schemes available and then decide whether you want to go ahead with this. You are also given the opportunity to access the value of cash through loans.
The universal life coverage is a fairly new scheme that is very beneficial because it provides a higher rate of return on the premiums that you pay. You are provided with a cash account and manipulations are carried out here. This provides permanent insurance coverage and hence there is nothing to worry about if you have enrolled for this type.
The limited pay life insurance scheme is one where all the premium amounts are paid and finished within a particular time period and once this time is over no other payments are due.
The endowment policy on the other hand is made with respect to a certain age. The value of the cash is grown within the policy itself which finally becomes equal to the amount that has to be received at death. Though this is expensive, after the time period whether the insured person is alive or dead, the amount is paid. Understanding the types of schemes available itself will help in the decision making process as to what you need to choose.
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