You know how important life insurance is to your family. What you may not know is that there are different types of life insurance, and that it’s important to choose the right one. To help you do that, let’s talk a little bit about the four major types of life insurance.
With this type of life insurance, you purchase a policy for a certain amount (say, $500,000) and a specific period of time (20 years, for example). If you pass away during that specific time period, your family (or other beneficiary) receives the value of your policy.
Whole Life Insurance
Just like term life insurance, with whole life insurance you purchase a policy for a certain amount. Unlike term life, however, whole life covers you for your entire life, not just for a specific time period.
Universal Life Insurance
Universal life is different that term and whole life, because it includes an investment aspect. With this type of life insurance, you can pay extra money above and beyond your premium. The insurance company then invests this extra money (with some policies you can even choose how your money is invested). With the returns you can get credit for your premiums, or let the money build up. With some types of whole life, this money goes toward the value of the policy. With other types, it is added to the value of the policy.
Variable Life Insurance
This type of life insurance is just like universal life insurance, but with more options for investments. Universal life insurance is usually limited to bonds and mortgages. But variable life insurance includes other types, such as stock funds.
To choose which policy is right for your family, it’s a good idea to talk with an agent who sells Life Insurance in Elyria OH. He or she can more fully explain these different types of insurance, as well as who each one is best for. And of course, he or she can answer any questions you may have, and help you decide which one is right for your family, your budget, and your goals.