Although 85% percent of North American’s agree that most people need life insurance, only 62% percent actually buy it. One reason for this disconnect between intention and action is that the seemingly convoluted nature of life insurance acts as a barrier to purchase.
The good news is that life insurance doesn’t need to be complicated! Use the chart below to get an idea of the different types of life insurance. Then speak to an agent to get a clear assessment of which alternative is right for you.
Life Insurance Types and How They Differ
|Life Insurance Type||Purpose||Sources for More Information|
Term Life Insurance
|Designed to meet insurance needs that will last for a finite period of time. Common examples include a mortgage, child rearing, and education. As you age, this type of insurance becomes more expensive and eventually is no longer available or affordable. It is available for terms of 5, 10, 15, 20, 25, and 30 years until age 65. There is also a version available to age 100 which is a cheaper alternative to permanent insurance.||Term Life Insurance|
Permanent Life Insurance
Designed to provide cash for your family and loved ones upon death, whenever that occurs.
It can also be used for a number of tax favored strategies, both personal and corporate.
|Permanent Life Insurance|
Whole Life Insurance
|Designed for people who want both guaranteed cash values as well as a potential for significant increase in coverage and cash value based on dividends or credits from the insurance company. The guarantees and dividends have frequently outperformed Universal Life polices over long periods.||Whole Life Insurance|
Universal Life Insurance
Designed with two primary purposes:
|Universal Life Insurance|