The Different Types of Life Insurance

Los Angeles Types of Life INsuranceLife insurance can seem like a scary topic that doesn’t have to be addressed until later in life, but neither are true. You get the best and cheapest coverage by starting your life insurance policy earlier in life and working with an experienced representative can ease your worries. There are different types of life insurance options. Compiled are some guidelines to help you through the process of choosing the right type of life insurance for your specific needs:

Term Life Insurance

  • If you only wish to have life insurance for a specific period of time, term life insurance will allow you to match the length of the term policy with the length of coverage you need. For instance, if you want to ensure funds for your child’s college education, you can invest in a 20 year term life insurance policy. Also, if you are looking for your insurance to repay a debt that will be paid off in a specific time period, you can buy a term life insurance policy for that period.
  • If you have a limited budget but need a large amount of life insurance, term life insurance will allow you to be financially protected in the event of your death during the specified time period. Since this type of insurance only pays if you die during the term, the rate per thousand of death benefit is lower than that of permanent life insurance. If you do not pass away during this period, the coverage will stop until the policy is renewed or a new one is purchased. This type of life insurance will not build equity over time in the form of cash savings, however.
  • Convertible term policies are intended to protect those with varying financial needs to convert to permanent insurance without medical examination in exchange for a higher premium.

Permanent Life Insurance

  • If you need life insurance for the duration of your life, a permanent policy pays a death benefit no matter when you die.
  • If you are looking to accumulate a savings element that will grow on a tax-deferred basis and act as a source of borrowed funds, permanent life insurance will allow you to do so in any way you choose.
  • Be aware that premiums for permanent polices are typically higher than term policies, but the premium remains the same throughout your life.

Meeting with an independent agent and going over your options may be the best way to figure out which type is best for you. Contact the insurance experts at Medwin Insurance Agency today to find out which life insurance policy is best for you.

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