Insurance Tips For U
Copyright 2005 Insurance Tips Today. All Rights Reserved.

Life Insurance  Information & Policy Tips

Life Insurance - Home Insurance - Auto Insurance & More . . .

Simply defined, Life insurance is a contract between the policy owner and the insurance company that issued the policy to the owner, where the insurance company agrees to pay a sum of money to the insureds designated beneficiary upon the occurrence of the insured policy holders death. The life insurance policy would also clearly stipulate that the policy holder must pay a certain sum of money at specified intervals, for example monthly, quarterly or yearly to keep the policy active. The money paid to the insurance companies by policy holders is referred to as the premium. Even though life expectancies worldwide have gone up due to advanced medical facilities and modern drugs. Our lives today are more complicated. People are more prone to depression and other ailments such as heart attacks that do not recognize age, sex or financial status and strike without warning. Terrorism is another factor now that has caused worry amongst citizens worldwide. Life insurance of some sort to protect your loved ones is definitely worth considering, especially if you can afford the premiums. Many life insurance policies today offer policies that are considered to be a way to save money for your retirement.

Types of Life Insurance

Policies

There are two major types of Life Insurance policies that are universally offered today by Insurance companies. 1. Whole life Insurance - Sometimes referred to as Permanent Insurance. 2. Term Life Insurance   Whole life insurance: is permanent life insurance coverage for as long as you live or until you reach the age of 100. Advantage of Whole Life insurance: is that your premium stays fixed and does not change for the life of the policy. Another benefit for Whole Life insurance is that there is a cash value feature that is guaranteed when the time comes to payout the policy. Disadvantage of Whole Life Policy: is that unless you get this type of insurance at a younger age the money you pay as insurance premiums will be very high. The high premiums of Whole Life policies is the reason many people go for another form of Life Insurance which is called 'Term Insurance' Term Life Insurance: is the most common type of insurance policy. Term insurance provides coverage for a fixed period (1 to 30 years). The premium paid for term insurance is very much lower than what you would pay for whole life insurance. The premium you pay for term insurance is also fixed for the term the policy is in force for. For example if your term insurance is for 25 years then your premium will be the same for 25 years. Once the term expires and you decide to renew for another term your premium amount will change to a higher premium as you will be 25 years older and hence considered a higher risk. Term Life Insurance pays a fixed amount as set out in your policy to your designated beneficiary if you die within the policy period. Such policies do not offer any cash value at the end of the term. Simply put if you die during the term your beneficiary gets paid. If you are still alive when the term lapses, you have the option of renewing the policy at a new (usually very high premium rate) or let your policy expire and get nothing. There are several other types of policies that are actually modified versions of the whole life policy. One such policy is called Endowment Policy. Endowment Policy: are somewhat similar to whole life policies where part of the premium you pay goes to build up a cash value fund. An endowment policy is a combination of insurance and investment. Such policies are designed to pay a lump sum after the specified term or death of the policy holder during the term. Endowment policies period can be specified i.e. 20 year endowment policy or 30 year endowment policy. Premiums for Endowment policies are higher when compared to whole life policy as more of the premium is devoted to building cash value. Variable Insurance Policy: This type of insurance allows you to have a say in how a portion of the insurance premium you pay is invested. Needless to say you assume the risk. Unless you are familiar with investments this is not an easy route to accumulate funds.
Copyright 2005 Insurance Tips Today. All Rights Reserved.

Life Insurance  Information &

Policy Tips

Life Insurance - Home Insurance -

Auto Insurance & More . . .

Simply defined, Life insurance is a contract between the policy owner and the insurance company that issued the policy to the owner, where the insurance company agrees to pay a sum of money to the insureds designated beneficiary upon the occurrence of the insured policy holders death. The life insurance policy would also clearly stipulate that the policy holder must pay a certain sum of money at specified intervals, for example monthly, quarterly or yearly to keep the policy active. The money paid to the insurance companies by policy holders is referred to as the premium. Even though life expectancies worldwide have gone up due to advanced medical facilities and modern drugs. Our lives today are more complicated. People are more prone to depression and other ailments such as heart attacks that do not recognize age, sex or financial status and strike without warning. Terrorism is another factor now that has caused worry amongst citizens worldwide. Life insurance of some sort to protect your loved ones is definitely worth considering, especially if you can afford the premiums. Many life insurance policies today offer policies that are considered to be a way to save money for your retirement.

Types of Life Insurance Policies

There are two major types of Life Insurance policies that are universally offered today by Insurance companies. 1. Whole life Insurance - Sometimes referred to as Permanent Insurance. 2. Term Life Insurance   Whole life insurance: is permanent life insurance coverage for as long as you live or until you reach the age of 100. Advantage of Whole Life insurance: is that your premium stays fixed and does not change for the life of the policy. Another benefit for Whole Life insurance is that there is a cash value feature that is guaranteed when the time comes to payout the policy. Disadvantage of Whole Life Policy: is that unless you get this type of insurance at a younger age the money you pay as insurance premiums will be very high. The high premiums of Whole Life policies is the reason many people go for another form of Life Insurance which is called 'Term Insurance' Term Life Insurance: is the most common type of insurance policy. Term insurance provides coverage for a fixed period (1 to 30 years). The premium paid for term insurance is very much lower than what you would pay for whole life insurance. The premium you pay for term insurance is also fixed for the term the policy is in force for. For example if your term insurance is for 25 years then your premium will be the same for 25 years. Once the term expires and you decide to renew for another term your premium amount will change to a higher premium as you will be 25 years older and hence considered a higher risk. Term Life Insurance pays a fixed amount as set out in your policy to your designated beneficiary if you die within the policy period. Such policies do not offer any cash value at the end of the term. Simply put if you die during the term your beneficiary gets paid. If you are still alive when the term lapses, you have the option of renewing the policy at a new (usually very high premium rate) or let your policy expire and get nothing. There are several other types of policies that are actually modified versions of the whole life policy. One such policy is called Endowment Policy. Endowment Policy: are somewhat similar to whole life policies where part of the premium you pay goes to build up a cash value fund. An endowment policy is a combination of insurance and investment. Such policies are designed to pay a lump sum after the specified term or death of the policy holder during the term. Endowment policies period can be specified i.e. 20 year endowment policy or 30 year endowment policy. Premiums for Endowment policies are higher when compared to whole life policy as more of the premium is devoted to building cash value. Variable Insurance Policy: This type of insurance allows you to have a say in how a portion of the insurance premium you pay is invested. Needless to say you assume the risk. Unless you are familiar with investments this is not an easy route to accumulate funds.
Insurance Tips  For U