You want to be sure that your family is well protected against financial hardship should you pass away. Even if you don’t have dependents, life insurance can help protect other investments you hold.

Life insurance will cover the cost of final expenses and should provide some monetary security for your loved ones. Not to mention, it will remove a significant burden from those closest to you. It pays to be educated on this topic and take measures for your protection!

This article introduces readers to many important aspects of life insurance, including why it’s needed, the different types that are available, and where they can find their perfect plan.

We’ll also explain the different coverage options, how to determine what’s best for you, and how much you should be able to afford.

Life insurance is a wise investment, no matter your age or current financial status. So go ahead and learn more about this helpful program designed to take care of the important people in your life.

• Plan Details
• Types of Insurance Coverage +Covered People & Dependents +Determining What’s Best
• Buying Life Insurance

Overview of Life Insurance Coverage Types

There are several different types of life insurance coverage. This article describes the following different types and what to consider when buying coverage:

Single-Premium Single Payable life insurance plan         

Single premium life insurance is a term used to describe a type of policy that requires one payment at the time you apply. This type of plan is similar to a traditional life insurance policy but requires only one single premium payment for all beneficiaries.

Single-Premium Multi-Payer life insurance plan      

A single premium multi-payer life insurance is a life policy that has more than one buyer named on the policy. Single premium coverage is essentially the same as any term life policy, but it’s paid for in one lump sum instead of in instalments over the course of the term.

Immediate and Continuity Life Insurance plans     

An immediate and continuity plan is a benefit that provides coverage that you will receive immediately after paying your premium. You can also choose an option that will protect your beneficiary with regular payments made to them for the long term. With this type of plan, you’ll have several options regarding the amount you need to pay each month.

Term Life Insurance plans 

Term life insurance policies are a type of insurance that covers you or a beneficiary for a period of time. These policies have fixed premiums and should be replaced every 20 to 30 years.

Universal Life Insurance plans

If you want coverage that can last for your lifetime, you’ll want to consider a universal life plan. These policies have flexible payments and become more comprehensive over time. They’re also able to provide more after-tax cash value than other types of policies.

Variable Universal Life Insurance plans       

This policy is similar to universal life; however, it allows you to determine how much money will be added each month for the coverage period. While you have the option of regular payments for this type of policy, some prefer to receive a lump sum upon retirement.

Lump-Sum Payment Life Insurance plans

This type of policy offers a large payment at retirement, and then smaller payments continue to be made on a monthly basis. This type of plan provides more security than universal life, as it will last for your life rather than being replaced every 10 or 20 years.

Different Types of Life Insurance Coverage

Life insurance coverage may be described as either term or permanent coverage. Term life insurance provides coverage for a specific period of time, usually ranging from 5 to 40 years. A permanent plan, however, covers someone for their entire lifetime.

Term Life Coverage

Term life is the most common type of coverage. And many employers accept it as an employee benefit. It offers protection against the loss of income if the insured person dies during the time period that’s covered under their policy.

Permanent Life Coverage

This policy provides protection that lasts the entire lifetime of the insured person (similar to term), but it can be costly due to the cash value they accumulate over time.

Hybrid Life Coverage

Combining the two types of coverage gives you a hybrid policy. This plan gives you the flexibility to add or extend your plan when necessary while still providing the option of a lump sum payment at retirement. This is called a convertible term plan.

 

Protecting Your Loved Ones After You’ve Passed

No matter what type of coverage you choose, it will cover funeral costs and provide financial support for your family when you pass away. These policies will also help protect other investments that depend on your income, including your home and other savings that you or your family have planned.

Life Insurance for Children      

Children are an important part of any family. And if your child is unable to provide for themselves, life insurance can help protect their future income. This type of coverage makes sure that property, insurance benefits, or other assets are safe after you pass away.

Life Insurance for Spouses  

This is ideal for the married couples. If one spouse passes away this type of policy will provide to take care of expenses.

Life Insurance for the Elderly

The elderly are another important part of any family. If they pass away, the family members may still need financial support to help cover funeral costs and other expenses related to their passing. The amount of coverage needed will depend on the age and financial needs of your relative.

Life Insurance for the Disabled

This type of insurance will provide for disabled people and their family members. It can help provide support if they’re unable to work.

Types of Life Insurance Contracts

There are many different types of life insurance contracts available for purchase. Each one provides a different level of protection, so it’s important that you pick a policy that works best for your needs and financial situation.

Cash Value contracts

This type applies a portion of the cash value to each payment made each year until the insured reaches age 65. This option can be beneficial if you want to protect certain assets and cover funeral expenses as well as your monthly expenses, but you would like to keep the flexibility of receiving a lump sum payment at retirement.

Universal contracts  

These plans protect those at any age and those who may not have accumulated very much in savings. The amount of coverage needed will depend on several factors, such as the person’s age and needs for income after retirement and their financial plans.

Lump-Sum Payment contracts

This type of contract is the ideal solution for those who want protection for their entire life but are unable to afford the added costs. The options available give you the freedom to take out a flexible payment that can change at any time.

Investigating & Choosing a Companies

Many local banks and credit unions will provide life insurance coverage for their employees. If you work for one of these organizations, purchase coverage through them if they offer the option.

 

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