Life Insurance

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Life insurance provides financial support to your loved ones or a beloved organization upon your death.  The life insurance company agrees to pay a sum of money to one or more named beneficiaries upon the death of the policy holder.  

However, some life policies also offer living benefits.  This means you could receive part of a death benefit while you’re still alive.

Term life insurance

A term life insurance policy gives you coverage for a set number of years. You can select the term period you want, such as 10, 20, or 30 years.

If you die during the coverage period and have a covered claim, your policy will pay benefits to your named beneficiaries. If you live past the selected period of time, the policy will simply expire.

Permanent life insurance

Unlike term life insurance that expires after a set number of years, a permanent life insurance policy doesn't expire and will cover you for your whole life. Permanent life insurance policies remain active until you die, unless you stop paying your premiums or surrender the policy.

The 4 most common types of permanent life insurance policies are:

• Whole life insurance: Unlike term life, whole life insurance doesn't have an expiration date. In addition, a portion of the premiums you pay into your whole life policy build cash value over time. 
• Burial insurance: These policies generally come with a death benefit that typically ranges from $5,000 to $25,000 and are often purchased by people who want to leave their beneficiaries with just enough money to cover their final expenses, such as funeral and burial costs.
• Universal life insurance: Like whole life, a universal life insurance policy provides a lifetime of coverage and can build cash value over time. However, this type of policy also provides flexibility when it comes to making payments. For example, if you have enough cash value in your policy, you can use that money to skip a premium payment.
• Variable life insurance: Variable life is another type of permanent life insurance that can build cash value. However, variable life differs from universal and whole life in that it has the potential to increase the value of certain subaccounts within the policy for even greater growth potential over time.

Whether you should pick term or whole life insurance depends on things like your needs and budget.

Term life insurance is often more affordable for people who need coverage but have a limited budget. For people willing to pay more that want a lifetime of coverage and access to cash value, a permanent policy may be a better option.

Before buying a term or permanent life insurance policy, it's important to consider the following:

• How much coverage you actually need
• Your budget and how much you can pay each month
• What types of policy riders, if any, are available and the costs
• The coverage and cost differences between policy types (quote comparisons)