Whole Life Insurance or Term Life Insurance?
Some solicitous parents care for their family, they want to give security, comfort and protection to their family, life insurance is the ideal plan, but which policy should we buy? Whole life or term life insurance?
There are also young solicitous young people who think far ahead, they care about their parents, they want to secure their future even they are single, and make family planning before they get married. Expenses for single and married persons are totally different, married people have bigger responsibility, and would life insurance premium a burden? It is imminent, but life insurance provides the family protection, the right policy to purchase should consider before we buy, because you are the one who buy and you are the one who pay.
The basic life insurance policies provide death benefit, but what else. There are whole life insurance and term life insurance, the most recommended by life insurance agents, so read this before you buy. Whole or term life insurance?
Whole life insurance
Whole life insurance is a life insurance policy that provides the insured a life-long protection; it is a type of permanent life insurance. In another word, if you bought a whole life insurance, you will have to pay a fixed amount of premium for life instead of the increasable premiums like term life insurance.
How long do we need to pay for a whole life insurance?
For whole life insurance, as long as you pay the premiums, you are covered with death benefit. But the whole life insurance provides the buyer with cash value, and the buyer can borrows money from the cash value, or if the buyer wished to stop paying the premium for some time, the cash value will pay the premiums automatically, so that the policy will not lapse. But if the cash value has used up, the buyer needs to start paying the premiums again or else the policy will lapse. Another benefit for whole life insurance is, the coverage is adjustable, and it can be increased. If the initial coverage is $50 thousand, the coverage after some years could be more than $50 thousand. That is to say the insured now has a whole life insurance coverage of more than the initial $50 thousand without paying more on the previously stated premiums.
Term life insurance
Since the word “term” in term life insurance means a specified period of time, it could be 10, 20, and 25 years or even more. The insured needs to pay a fixed amount of premiums, the premiums are calculated according to the term the buyer required, the insured will have coverage, this coverage is also specified by the buyer, and it could be $10 thousand, $20 thousand or more. When the term has expired the buyer can cease to pay the premium, but the insured will no longer under cover, and the buyer will not obtain any money upon the expired policy. This type of term policy is called term life insurance. For term life insurance provides no cash value, it only provides coverage to the insured, and its premium is the cheapest among all other life insurance in the market.
Term life insurance is designed for those who only want protection, with more coverage and least premium.
The difference between whole life insurance and term life insurance is that whole life insurance insures you for whole life; the beneficiary will receive the proceeds upon your death, no matter under what circumstances. Term life insurance insures you for your death only during the term or period specified, whether it is 1 year or up to 35 years, depending on what term life insurance you bought.
To buy whole or term life insurance depends on what the buyer needs, if he wants life insurance solely for coverage, term life insurance has lower premium for this purpose, if he wants to have life insurance for coverage and also savings or if he thinks that he wants to borrow some money from the cash value, whole life insurance would be a better recommendation.
In fact whole or term life insurance are basically not much different, there are life insurance with cash value and without cash value, some people even bought whole and term life insurance. You can seek advice from knowledgeable and trustworthy life insurance agents or insurance companies; they can give you a thorough definition and free quote, so that you can make up your mind whether whole or term life insurance to purchase.
