Life Insurance

Life insurance is another kind of insurance wherein it is life itself gets protected from the uncertainties and unexpected incidents in one’s life. It is like preparing for any untoward incidents. This is ideal for anybody who is working for a living earning income to support their family. It would give him a huge sense stability and security to have his entire family protected by a life insurance. Buying a policy means you are assured of a financial assistance in case you lost your job and therefore loss of income, funeral arrangements, pay for your children’s education incase needed. You know what policy that will nicely fit to your family’s needs and requirements. You can take the plan that will fit your family’s situation.

There are three kinds of life insurance policy, whole insurance, term insurance and the universal insurance. It is considered as permanent insurance since it includes the entire life of the person insured and beyond for he has death benefits too. It involves an insurance and investment fund. A part of the premium paid is used to build a cash value investment that will be made by the insurance company for the insured. In cases of need, the insured can even borrow from the cash accumulated in his investment fund without being taxed. The term insurance has no investment component and it only last for a set period of time. /payment of premiums is made only during the specific time period. It also has death benefits which is available only during the specified time period. It is renewable yearly meaning you purchase the policy year after year. But if you don’t want to renew it, you can opt to change it into cash value policy. The universal insurance is another kind of life insurance policy that is a combination of term insurance plan with money market type of investment. Your investment is tied up to stocks or bond mutual fund and returns are not guaranteed. On the other hand, the term insurance policy has tax deferred interest thus savings account is accrued.

It is best to buy life insurance when you are young, healthy and at the prime of your life. Life insurance is at its cheapest rates when the buyer is young and in good health. People who have heart conditions and over weight will have to pay 50 percent more than the normal rates of the life insurance. Others, who smoke, have dangerous jobs and are into dangerous sports like racing and skydiving are likely to pay higher premium rates. The best thing to do is to shop around in the internet for insurance company who might charge less than the others. Or if you know any insurance agent you might want to ask for advice regarding your situation. But remember, it never pays to fool the insurance company since these companies are expected to know their field and they know when they are being lied upon. You don’t want to have your claim to be denied when the time comes for your family to collect it.