What Type Of Life Insurance Is Right For You?

Buying life insurance to protect your family’s future requires you to make some important choices, including the type of life insurance you need. If you’re a first-time life insurance shopper, chances are you may not know which option may be the right one for you. Below is a breakdown of various life insurance options to help you find the best match.

Term Life Insurance
Term life insurance has level premiums that last for a set number of years (the term). This life insurance includes a death benefit in the form of a lump sum of cash that’s paid out to a beneficiary by the life insurance company if you die during the term period. This lump sum that can be used for a variety of things, from burial expenses to mortgage and debt payments, to living expenses for your family, to donations, generally tax-free.  After the term expires the policy terminates. In order to continue coverage, you’ll have to convert your policy to permanent coverage before the term ends, renew it for another term, or shop for a new policy.

Key Features of the Policy

• It provides a generally tax-free death benefit for your loved ones.
• Easy-to-understand.
• It’s the least expensive form of life insurance.
• The low-level premium expires after a set number of years or term.
• Who Should Buy It?

Term life insurance is a great choice for most life insurance shoppers because it’s simple and cost-effective. If you’re on a tight budget, or you’re a young person age 20-30 who is just starting to build your financial future, term life insurance can be a good match for you.
 

Guaranteed Universal Life Insurance
Guaranteed Universal Life insurance is permanent coverage that provides the ability to guarantee a death benefit to any age up to a maximum as stated in the policy, as long as premiums are paid and the policy remains in force. Guaranteed universal life insurance is not designed to build up cash value. 

Key Features of the Policy

• Can provide a guaranteed death benefit for your whole life
• Death benefit passes to beneficiaries generally tax-free
• Who Should Buy It?
• Anyone with a need for death benefit coverage who desires to buy a policy that can cover their entire life with less costly premiums compared to other permanent products.

Remember that you don’t have to make a decision about life insurance alone. If you feel lost or overwhelmed by the choices or complexities of the products, discuss the pros, cons and possibilities with a financial professional.
Life insurance policies have terms under which the policy may be continued in force or discontinued.  Current cost of insurance rates and interest rates are not guaranteed. Therefore, the planned periodic premium may not be sufficient to carry the contract to maturity.