It can be a very overwhelming feeling when it comes to deciding what the best life insurance coverage is for you. With all the different coverage options how do you decided on one from another? This is a common concern to most people when they start their search for life insurance coverage.
We want you to know that at Top Quote Life Insurance you are not alone in your search for life insurance. With a little time spent reading this article we will break down the three primary types of life insurance, term life insurance, universal life insurance and whole life insurance.
By familiarizing yourself with what each one of these types of life insurance coverage can provide you, we believe you will have no problem picking the best coverage that fits your needs. When you are able to pick the best life insurance coverage for your needs, getting the best quote for the coverage will be a cinch.
Term Life Insurance Coverage
Term life insurance coverage is one of the most popular types of life insurance coverage, since it fits most individuals’ needs. Most life insurance agents will agree that it is the best life insurance coverage when it comes to price.
As its name suggests, term life insurance coverage provides a guaranteed death benefit throughout a specific period of time, beginning with the initial policy date.
Term life insurance coverage commonly comes in fixed premium contract lengths of 10, 15, 20, 25 and 30 years. Depending on what coverage length you decide to go with, your premiums are guaranteed not to change. In other words pay one premium every until the end of the term coverage.
When a term life insurance policy comes to the end of its fixed premium period you will be given the option to continue coverage under the same policy. Continuing coverage under the same policy is generally very expensive after the fixed premium period has expired.
Another option that comes standard with most term life insurance policies is the option to convert a portion or all of the death benefit to permanent life insurance. We often recommend doing this only if your health has declined since the purchase of your term policy as premiums for this coverage can be a bit expensive.
Out of the three types of life insurance coverage, term is by far the cheapest. Term life insurance is a perfect choice of coverage when your needs are high and temporary. Temporary needs may include replacing a loss of income for spouse during working years. Income for college education for your children. Income to replace mortgage debt.
Whole Life Insurance Coverage
Whole life insurance coverage is the perfect coverage for someone who is looking for a lifetime of permanent coverage. Whole life insurance will allow you to lock in a fixed premium, as well all the possibility to make some fairly decent dividends or cash within your policy.
Out of all three of the life insurance coverage options whole life insurance is the most expensive. The younger you are when you purchase whole life the better. Life insurance in general is always cheaper to purchase when you are younger rather than later in life, especially whole life.
You may ask yourself why purchase whole life insurance if it’s so expensive? By purchasing whole life insurance think of it as a savings account with higher interest rates than what your bank can offer which can lead to some very nice cash values.
Another reason for paying higher rates for whole insurance is because you are paying for the coverage, in advance, over a lifetime. The increased cost of the insurance at your later years is spread out evenly throughout your lifetime resulting in a fixed premium.
As stated earlier, whole life insurance policies have the opportunity to gain dividends. Dividends can be used to reduce your premium, pay for paid up life insurance coverage or used to borrow money from the policy just like getting a loan from a bank. It is important to know that dividends are not guaranteed.
Whole life insurance can make for a great life insurance option for either children or adults.
Universal Life Insurance Coverage
Universal life insurance coverage or often referred to as guaranteed universal life insurance (GUL). Universal life insurance is similar to whole life coverage minus the expensive premiums and dividends aspect.
Universal life insurance also offers a lifetime of protection, but at a cheaper cost than whole life insurance. The premiums for this coverage are cheaper because you are basically paying for the cost of the insurance spread out over an entire lifetime.
So why is it cheaper if you are paying for coverage spread out throughout my lifetime? Well, take away the savings account and dividends aspect. Unless you are paying more than the required premium, universal life insurance does not gain nearly as much as a whole life insurance policy can.
Universal life insurance focuses on lifetime protection at a fixed rate. Many life insurance agents referred to universal life insurance as permanent term life insurance. Term will eventually end, but universal life insurance is forever and has a forever fixed rate.
Another great feature with universal life insurance is the flexibility of the coverage. If your policy has cash value, you may be able to skip payments and the insurance company will draw the payment from the cash value to keep the coverage inforce.
Universal life insurance policies have come a long way since the 1980’s & 1990’s. Universal life insurance policies have received a bad rap because they never had the guarantees that they do now. With guaranteed no lapse fixed premiums and special features like return of premium and long term care riders now with universal life insurance, we highly recommend this coverage when seeking lifetime life insurance coverage.
Quotes for Getting the Best Life Insurance Coverage
Top Quote Life Insurance specializes and offers term life insurance coverage, whole life insurance coverage and universal life insurance coverage. For an instant quote from all of our top life insurance carries please feel free to give us a call (888) 777-7574, send us an email with your request or simply use our instant quote located to the right of your screen.
What is the Best Life Insurance Coverage by Jeffrey Manola Top Quote Life Insurance