Life insurance began centuries ago back in Rome. Although it had a different purpose back then, resembling something more akin to Mafia protection than anything else, it remained in vogue throughout the following millennia. Whereas its original purpose would be to pay individuals to protect you from being mugged (like security guards) while at work, providing you paid your dues on time, its more modern purpose is to provide cash to your family if you die.
Life insurance comes in two forms: term, which is the cheapest, and whole life which costs considerably more but provides a few additional benefits. Depending on what you need and what you want to leave behind for your family will depend on which type of insurance to buy.
Term life insurance is pretty much what it sounds like. You buy it for a specific term, or period of time, which usually runs from ten years to thirty, depending on the company from which you are buying your policy. The younger you are and the lower your face value, the lower your monthly premiums.
Cash value policies also have an investment portion included, which may not be the best choice for many families. Because the investment amount is included in your monthly premium, many families are better off just by taking that money, investing it themselves and keeping their profits. The insurance company actually keeps most the money earned from all the investment accounts – not a great deal!
Term insurance is the newest addition to all insurance products, having been introduced only in the 50s and gaining in popularity over the decades. Its original intent was to just have enough money for your family to pay for a decent burial and nothing more. Policies for $10,000 were the most common.
Universal or whole life is the other type of insurance. It provides coverage for your whole life, providing you keep the policy in effect. For this reason, the premiums are much more expensive than a term life policy because the insurer knows it will ultimately need to pay your survivors. They aren’t gambling on when you are going to die. They know you will and they know they will pay.
An important difference between these two types of policies, and a financial consideration when looking for the best deal for your money, is the fact that with term policies you can have an entire family covered. With cash value you need a separate policy for each person.
Purchasing the right life insurance cover has never been easier. Get inside information now in our life insurance qualify review.
categories: life insurance
Tags: Insurance, Life Insurance
Facebook
LinkedIn
Twitter
Youtube
"OUR BLOG"