THE DIFFERENT TYPES OF LIFE INSURANCE
At the Perzel Agency, we can offer you Term Insurance, Universal Life Insurance, or Whole Life Insurance.
Here are the advantages of the three types of policies:
- Term locks in a specific rate for a specific period of time. It’s the lowest-cost form of life insurance that you can get, but it doesn’t offer any cash value, and it becomes VERY expensive if you keep it beyond the Term. Term Insurance is perfect is you are covering a specific debt (such as a 30 year Mortgage).
- Universal Life covers you at the quoted rate for your whole life – regardless of how long you live. As long as you pay the quoted premium, you have whatever coverage you applied for. Although Universal Life accumulates Cash Value, in this policy the Cash Value is used to keep the premium level throughout your lifetime.
- Whole Life covers you at the quoted rate for your whole life – regardless of how long you live. As long as you pay the quoted premium, you have whatever coverage you applied for. Additionally, Whole Life accumulates Cash Value, which you can borrow as needed, and which can be used to get you additional insurance coverage if you choose. Whole Life is the most expensive form of insurance for two reasons: (1) you have Cash Value, and (2) you are covered for your entire life.
As a quick summary:
- If you want the least expensive coverage for a limited Term, choose Term Insurance.
- If you want life-long coverage with level premiums, choose Universal Life.
- If you want life-long coverage with level premiums and guaranteed Cash Value, choose Whole Life.
Bill Martino, CLU, ChFC, CASL
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