Finding the facts about life insurance is a must thing to do, especially for those who do not have any experience in buying insurance’ policies before. If you have a plan to buy the policies, it is important for you to firstly determine about the specific need and then ask yourself whether you really need to have life insurance. Since it is not a cheap investment, some good considerations are strictly needed, including about the essential facts about life insurance. The following explanation consists of the common policies which are generally issued by many insurance agents.
Facts about Life Insurance: The Policies
The very basic facts about life insurance are about the policies. Currently, there are two different types of policy or coverage: the term and cash value. The term insurance refers to the contract for particular period of time. The amount of such insurance can reach up to $100,000 and the policyholder (you) will have to pay between $100 and $1,000 for the premium each month. The exact amount will be determined by individual’s age and health. When the term comes to the end, the coverage will be stopped unless you renew the policy. It becomes one of the most important facts about life insurance you should know.
The next facts about life insurance are about the benefit and the downside. The major benefit of choosing the term insurance is the permission for families to decrease the coverage if necessary. There are few downsides of term insurance, but the number one problem is about the renewal cost. The older age will require higher cost, thus the premiums could reach up to double within several years. In dealing with this one of facts about life insurance, you need to prepare extra budget and check the latest rate.
The cash value insurance, on the other hand, will stay in effect until you die (this is the common case. There are three types of cash value insurance, such as the universal, the whole and also the variable life. In fact, the second one is the most widely chosen. Among the other facts about life insurance, cash value offers the more surprising facts. The long-term benefits provide the opportunity and the option of borrowing, but the rate of premiums could reach up to three times as much as the term insurance. In this case, the payments will be determined based on someone’s age when he or she buys the policy. However, the rate will not increase over the lifetime. The policy features savings component too, and it becomes the most interesting thing among other facts about life insurance.
When you wish to choose one of those types, please always take the facts about life insurance above into your consideration. Think about your budget, your age, and your needs. So, you can finally get the most suitable life insurance. Find other Insurance Facts like Facts About Auto Insurance and Facts About Car Insurance.