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What Type Of Life Insurance Is Right For You?

What Type Of Life Insurance Is Right For You?

September 10, 2019

Thinking about life insurance may be a little awkward and uncomfortable. Death is a subject that needs to be addressed to ensure that your family is taken care of in the event of a catastrophe. Contrary to popular belief, life insurance can be useful at any age and not just for “older people.” It may be frustrating deciding what type of life insurance is a good fit, but we’re here to help make the process less confusing! There are two main types of life insurance; term and permanent. Keep reading for more information on both.

Term Life Insurance:

With term life insurance the insurance company will pay a fixed amount of money to your loved ones, but only if you pass away during the term you specify (i.e. 20 years, 30 years). When you initially purchase this insurance, you would choose the family members you’d like covered and the fixed amount you’d like them to receive after your death. Depending on how many years of coverage you choose, you’ll make monthly payments for the length of that term. There are options to renew your plan for another term, but keep in mind that rates may go up and extra fees may apply. This type of life insurance is usually more appealing for young people who have fewer financial obligations. Term life insurance is usually the more inexpensive option, but it gets very expensive as you get older.

Permanent Life Insurance:

With permanent life insurance there is no specified term, meaning the policy never expires, as long as you pay the premiums. There are two components involved in this type of life insurance. One part is the money that will cover your family after your death and the other part is the cash value. For the cash value you are depositing money every month that the insurance company puts towards investments. How much money goes towards your policy and your cash value varies over the years and the plan. Keep in mind that any cash value you have left after you die will go directly back to the insurance company and not to your family. Unlike term life insurance, permanent life insurance is usually more appealing for older people who have a lot of financial obligations and is more usually more expensive. It can get very complicated, so be sure to research, research, research your options.

No matter what type of life insurance you end up choosing, remember the main goal is providing financial support for your family after your death. You want to be sure that the policy you purchase is at least enough to replace your income if you were to die. Life insurance should be essential when looking at what to include in your family finances. How financially secure you leave your loved ones is up to you, so why not leave them with as little financial obstacles as possible? Give us a call if you want to discuss this further. We are here to help with ALL your financial needs.



This material contains only general descriptions and is not a solicitation to sell any insurance product or security, nor is it intended as any financial or tax advice. For more information about specific insurance needs or situations, contact your insurance agent. This article is intended to assist in educating you about insurance generally and not to provide personal service. They may not take into account your personal characteristics such as budget, assets, risk tolerance, family situation or activities which may affect the type of insurance that would be right for you. In addition, state insurance laws and insurance underwriting rules may affect available coverage and its costs. Guarantees are based on the claims paying ability of the issuing company. If you need more information or would like personal advice you should consult an insurance professional. You may also visit your state’s insurance department for more information.