The Major Types Of Life Insurance

​An insurer and policyholder enter a life insurance contract. A life insurance policy guarantees the insurer may pay a sum to named beneficiaries upon the insured's death. Life insurance is important for financial and legacy planning. 

What Are the Types of Life Insurance? 
All life insurance needs can be met. The insured's short- or long-term demands determine temporary or permanent life insurance. Here are life insurance types:

Term Life Insurance
Term life insurance lasts 1, 5, 10, or 30 years. Only if the insured dies within the period is a payout made. If the insured outlives the policy period, coverage may be renewed at increased premiums. Term life insurance has many types.

1. Decreasing Term Life Insurance
   Renewable term life insurance with coverage decreasing at a predetermined rate over the policy's duration.
2. Convertible Term Life Insurance
   Permit policyholders to switch from temporary to permanent protection. 
3. Renewable Term Life Insurance
   Quote the policy's purchase year. Premiums increase annually and are the cheapest term insurance initially.

Permanent Life Insurance 
Permanent life insurance lasts as long as the policyholder pays the payments or cancels the policy. It's pricier than a term plan.

These plans build monetary value that the policyholder or heirs can access. High-term life premiums. Whole-life products include traditional, universal, variable, and variable-universal. Permanent life insurance has many types.

1. Whole Life
   Accumulate cash. The policyholder can utilize cash-value life insurance to pay premiums or borrow money.
2. Universal Life (UL)
   Different types can be confusing. Universal life lacks guarantees, so it is cheaper than whole life. Some universal life policies allow adjusting premiums and death benefits. Cash-value UL is common. 
3. Indexed Universal Life(IUL)
   Cash value returns are fixed or equity-indexed.
4. Variable Universal
   The cash value can be invested. There are flexible premiums and a rising death benefit.

Life Insurance Comparisons
Unlike term life insurance, the premiums for a permanent or whole-life policy are not guaranteed to decrease. They may remain constant throughout the policyholder's lifetime. As a result, you may get a lower death benefit for the same premium as you would with term life. 

People opt for whole life insurance policies because of the policy's tax-deferred savings growth potential via its cash value component and the predictability of its benefits and premiums.

Conclusion
Choose life insurance that fits your budget and needs. Your needs, family, and goals may change over time. When that happens, you'll need to reevaluate your insurance to ensure you're covered.

At Insurance Plans of America, we aim to provide comprehensive insurance policies that make your life easier. We want to help you get insurance that fits your needs. You can get more information about our products and services by calling our agency at (877) 752-6711. Get your free quote today by CLICKING HERE. Topics and coverage discussed in this article are not guaranteed, consult with your agents to determine what your policy does and does not cover. We are more than happy to help!