Thursday, January 28, 2016

Different Types Of Life Insurance Policy

Life insurance aims at securing income for a family in case the policy holder dies unexpectedly. If one gets married, it is advisable that he or she gets life insurance so that the dependants do not get subjected to financial disarray when the individual dies. Below are different types of life insurance

Critical illness insurance

Critical life insurance is a form of coverage that provides a person with lump sum payments if he or she suffers serious illness. Critical life insurance coverage is beneficial though the quotes are expensive.

Life Insurance

Permanent Life Insurance

This life insurance is expensive during the initial five years of the policy. However, one can be guaranteed that the cost of insurance will remain constant. Consistent payment of premiums guarantees some benefits to the policy holder. For those concerned about the future of their heirs, this policy is an ideal solution. There are two sub-types of permanent life insurance. They include whole life and universal life insurance. Whole life coverage is preferable for people interested in a life time coverage.

Term insurance

Term insurance has similar features with home insurance and car insurance policies. It is a pure insurance, and individuals can only be compensated if they file claims. The insurance cost tends to increase yearly for a given time. The coverage also expires though, one can renew it, but, at a higher premium. It is worth mentioning that this life insurance is the cheapest and the most suitable for individuals that are interested in getting life insurance policy. This policy can support one’s family until they get old enough especially if it offers twenty years coverage. Term life insurance has got a feature referred to as guaranteed renewable rider. Many people like this feature since it provides a guarantee that the insurance policy will remain in place after the expiry of the first term. This is possible if the individual is consistent in the submission of premiums. This feature eliminates the need to re-apply to prove that an individual is eligible for coverage.

Level premium insurance

Level premium insurance is not costly. It allows one to plan for the payment of premiums since it has a fixed set of premiums to be remitted. If a person has an interest in acquiring a life insurance cover for five to ten years, he or she should opt for Annual Renewable Term policy. This policy is less costly during the initial five to six years, but, the premium begins to increase after this specified time.


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