Life insurance comes in many shapes and sizes, but the different types of life insurance policies generally fall into two categories: term life insurance and permanent life insurance.
Types of Term Life Insurance Policies
Term life insurance is the most affordable type of life insurance available. It is designed to meet temporary life insurance needs; providing protection for a specified period of time, the term. For example, a term of 10, 20 or 30 years. This type of life insurance makes sense if you have financial needs that will diminish over time, such as a home mortgage or a child’s tuition.
Each year, a premium is paid to cover the risk of death during that year. Term life insurance has no cash value. The only way to collect anything is to die before the term life insurance expires. If death occurs, the life insurance beneficiary generally collects the death benefit of the life insurance policy, free of income tax.
More information about term life insurance go to www.wikipedia.org/Term_life_insurance
Types of Permanent Life Insurance Policies
Permanent life insurance provides lifelong protection. This type of life insurance policy never ends as long as the premiums are paid. In addition, permanent life insurance provides a savings element that accumulates a cash value over a long period of time. Permanent Insurance is more expensive than Term Insurance.
More information about permanent life insurance go to www.wikipedia.org/Permanent_life_insurance
In addition to traditional term life insurance and permanent life insurance, there are many other types of life insurance available.
- Child Life Insurance
- Accidental Death Insurance
- Disability Insurance
- Final Expense Insurance
- No Medical Exam Life Insurance
- Long Term Care Insurance
- Critical Illness Insurance