Term and Whole Life Insurance
When discovering your need for life insurance the next step is to understand what type of life insurance may fit your needs best. The two major types of life insurance are term and whole life insurance. Each has its benefits and which works best really depends on your individual needs.
Term life insurance as the name implies, covers a certain period of time. The two decisions to make when looking at term life insurance is first what length of period do you want to cover and secondly, how much coverage do you want? Usually life insurance companies provide increments of 5 years (10, 15, 20, 25 and 30 year) for term life policies. Term life is less expensive in general compared to whole life since it focuses only on covering a certain time period. This is a good option for covering a mortgage or if you'd like to make sure your children are supported until they’re a certain age.
Whole life insurance covers your whole life (usually up to age 120 depending on your policy). Even though whole life is the more expensive of the two options, whole life is a great option if you're young and healthy. This way you have coverage in place if any health conditions appear. This way you can lock coverage in place and for a fixed rate, instead of trying to put coverage in place when you find you have a health condition.
In some cases, it make sense to have a layer of term and whole life insurance. Again, this is specific to your individual needs, that's why it’s best to speak with a life insurance professional.
by Charles J. Greve at CJG Insurance Group
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