Life Insurance Basics

Written By: Emery Holiday on June 19, 2010 No Comment

Dying is an unfortunate reality for everyone and life insurance is designed to protect those left behind. Financial hardships resulting from a family member’s death can be devastating. Life insurance provides some security from the loss of a loved one’s financial contributions. They pay a lump sum to the named beneficiaries when the insured dies.

Term insurance is a very popular type of life insurance. Term offers coverage for a predefined amount of time, such as 10, 15, 20 or 30 years. During that time, the premiums may remain constant or they may change depending upon the specific product chosen. Term insurance is very attractive due to its relative low cost compared to permanent life insurance. However, once the term is up, the insured no longer has coverage. Since the insured would then be older, replacing the coverage can often be much more expensive.

Whole life insurance is a type of permanent insurance. That means it has no predefined period of coverage. As long as premiums are paid, it will remain in force until the insured dies. Whole life also accumulates cash value which can be borrowed against by the policy owner, then used however they like.

Universal life insurance offers permanent insurance coverage. It builds up cash value, but is considered more flexible than Whole life insurance. This is because the premiums can be paid from the cash value to keep the policy in force, if they are not paid out of pocket by the owner. In addition, premiums can be offset by lowering the death benefit if cash value is not available in the policy. The flexibility of Universal life insurance is making it one of the most popular forms of permanent life insurance on the market today.

Life insurance provides a peace of mind that financial security won’t compound the issues associated with someone’s death. There a wide variety of policies available to suit everyone’s budget and particular needs.

Want to find out more about Las Vegas life insurance, then visit Emery Holiday’s site on how to choose the best life insurance for your needs.

categories: life insurance,insurance,financial planning,retirement