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Wednesday, December 23, 2009

Make Money

Life insurance and the coverage typesIt is a challenge for you to choose the right life insurance policy unless you can identify your specific needs. In order to shop for the right kind of benefits, you may need to analyze the different types of life insurance.

• Term Life – Term life insurance is the simplest kind of life insurance available to you. You may get covered for a specific period by paying a certain price. If you die within the policy period, the death benefit (the policy value) will be paid to your beneficiaries. There is no investment component attached to it.

• Whole Life – This is almost similar to a term life policy, but over here you choose coverage for your entire life time. Premiums remain consistent till your policy matures and your carrier is expected to invest a significant part of it in the market. Some policies will allow you to enjoy a fair share of such investment proceeds as dividends, while others will not. There are carriers who will guarantee a lower rate of return, but will actually pay you more than that.

• Universal Life – Your premium options are more flexible than other types of life insurance coverage. The investment vehicle is generally limited to mortgages and bonds. Your investment along with the returns is placed in a cash-value account wherein they may accumulate or can be used against your premiums. Upon the death of a policy holder, some policies will use this cash account against the policy face value.

• Universal Variable Life – These policies have very little difference with the Universal life policies. Your investment opportunity widens when compared to other types of life insurance policies. You’ll get an opportunity to invest in stock market. Your investment returns may offset your insurance cost or get accumulated in a cash-value account. This will protect your finances and ensure a safe future for you.

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