A life insurance policy is one where you are legally bound to make payments annually, monthly, or semi-annually to an insurance company so after you die, your family is looked after by the insurance company by providing a death benefit. The person collecting this death benefit will be known as your beneficiary and will make it an easier process for them to deal with your death. Saving your loved ones from emotional and financial strains after your death by getting a life insurance policy is something we urge you to do.
When you owe an individual something, that individual is known as creditors. Creditors will try and get your loved ones to pay off the debts you used to owe them by going after your assets, but they can’t go against the life insurance benefits. This is why having life insurance has been proven to offer the loved ones of the deceased peace of mind while being inexpensive.
Although a life insurance policy can be divided into many categories, the two major categories are:
Term Life Insurance: A term life insurance covers you for a specified time, which can be 10, 20, or 30 years. Dying during the term of this policy will ensure that the insurer pays the death benefit that he’s required to by the insurance policy, to your chosen beneficiary.
You will be required to decide the length of your policy and the amount of money you want to be in the death benefit. The longer the term, the more expensive your payments will be whether you’re giving them monthly, semi-annually, or annually. You’ll need to decide the length of the policy and your desired amount of coverage.
The premiums for term life insurance are consistent throughout the term, which is why most people prefer getting term life insurance. They are inexpensive and stable because they’re temporary. You can get a term life insurance policy for literally 1$ a day after you’ve been qualified by insurers for prices that low.
Permanent Life Insurance: This type of insurance policy can cover you through your entire life-spam, while also offering a system similar to a savings account, known as cash value. This policy also comes in a several varieties, one of which is:
- Whole Life Insurance: A whole life insurance might seem similar to a term life insurance policy since it also has a fixed premium. This fixed premium allows you to make payments to the insurer consisting of the same price each year. This policy can last a lifetime as long as you’re willing to make your payments in time. What makes it different from a term life insurance policy is the cash value account that comes with it.
While some of your money will be going towards the death benefit you’re set up for your loved ones, the rest will be deposited into a cash-value account that like any other bank account, grows at a steady rate of return which is commonly 4% or more. A good insurance company like insuranceandestates will be happy to oblige with any kind of insurance policy you desire.