Life
Insurance - Who Should Have Life Insurance And What Kind Of Policy?
(Read This Article Before It)
Life insurance
doesn't benefit the person that dies; it benefits those who are the
beneficiaries. There are many types and many reasons to buy life insurance
but you need to consider the needs of your family and how long they
will need protection.
Life
Insurance For The Living
The best life insurance policy is one that pays the biggest benefit.
If there are young children you should have a term life insurance
policy and if both parents work, there should be disability insurance
as well. And anyone with dependents or liabilities, should move
to protect themselves at the lowest possible cost.
Do I Pay Forever?
The reality is that the policy should benefit the surviving spouse
after the children have left home if you do not have a lot of assets. Term Life Insurance
The two most common types of life insurance are term life insurance
and whole life insurance. Term life insurance offers coverage for
a specific number of years with a set premium. If you choose a policy
to age 100, you are buying a policy, similar to whole life but without
the cost.
The biggest drawback is that you can keep on paying and have no
value if you decide to cancel. But that is what life insurance or
any type of insurance is about; risk.
You insure your car and house but you don't secretly hope to have
an accident or your home burn down. And whenever you sell either,
you cancel the policy but don't receive a refund of the premiums.
And so it is with term life insurance. It is just that; insurance
against an event that may happen prematurely. And if you decide
to keep it, your purpose has changed from protection against death
to the provision of the proceeds to your family and loved ones.
Whole Life Insurance
Term life insurance
is up to five times cheaper than whole life and for that reason,
provides up to five times greater coverage. This type of policy
will provide a cash value at a later date, but remember that you
have paid a fair amount more in premium.
And this cost of term life insurance compared to other types, holds
true until the older ages. Then both types must be compared to see
which offers the greatest advantage. Both policies offer
protection but a very different cost.
When you are younger, the two best reasons to buy term life insurance
are that it is cheaper and gives you greater coverage.
When
you are older, your needs have changed. If you have become wealthy,
perhaps you need to continue with the coverage to pay income taxes.
If not, perhaps you will need to keep the coverage so that your
spouse can buy a life annuity to provide just that, an income for
life.(Author)
