Life Insurance

Whole Life Insurance

Whole Life sometimes called "permanent insurance", or "ordinary life", is designed to stay in force throughout a person's lifetime. The policy remains in force as long as the policy owner pays the premiums, regardless of any changes in health that may occur. Premiums for most whole life policies remain level and can be paid on an annual, semi-annual, quarterly, or monthly basis.

Universal Life

Universal Life differs from traditional whole life policies by specifically separating and identifying the "mortality", "expense", and "cash value" parts of a policy. Dividing the policy into these three components allows the insurance company to build a higher degree of flexibility into the contract. This flexibility allows (within certain limits) the policy owner to modify the policy face amount or premium, in response to changing needs and circumstances. A monthly charge for both the "mortality" element and the "expense" element is deducted from the policy's account balance.

Term Life Insurance

Term Life provides life insurance only for a limited period of time, or "term." Other types of policies such as whole life, and universal life are considered to be "permanent" insurance, and are designed to provide protection for the entire life of the insured. Term insurance provides only "pure" insurance protection and does not have the cash value feature typically found in most permanent life insurance policies. Term insurance may be compared to an automobile insurance policy. While the auto policy is in force, the insured enjoys protection against loss from an auto accident.

Syndicate content