Types of Life Insurance

There are two main categories of life insurance policies – we will now, proceed to elaborate on them.

 

Term Life Insurance:

Is an insurance policy that has a clock on it– fundamentally, a specified time period during which the contract is realizable, at the end of which it attains expiration. A time period settled upon by both parties, typically 10, 20, 30 years. The time period is directly linked to the number of premiums paid.

The major swindle in this policy, is natural death, a matter not under our jurisdiction. If the insured party lives beyond the allotted time window, the contract will terminate itself. No death benefit would be payed, and all the premiums paid would be for nothing.

However, both parties are painfully aware of this clause prior to agreement.

Suitable For:

People with several, heavily reliant family members. Someone with a stable medical history, opting for this policy as a worst case scenario.

Not suitable for:

People suffering from serious medical problems. Involves generally young or middle – aged people.

 

Whole Life Insurance Policy:

Whole life insurance policy stands for a person’s lifetime. The insured party continues to pay his premiums, and merely informs the company of his heritors. It is extremely similar to an investment.

Upon death, as per his specific insurance policy, the death benefit is released to the dependents. It is by far the most common, and popular type of policy opted for by people.

It offers long term assurance and is highly feasible for those who want to secure the future of their loved ones – want to leave something behind for them.
Suitable For:

Clients ranging between the ages of 45 – 85, holding large families.

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