Term Life Insurance » Life Insurance Basics

Life insurance is a product that provides protection for loved ones. There are many different life products to fit different needs. The major categories are term and whole or permanent policies.

Term life is the least expensive coverage and pays the policy amount in the event of the insured’s death. The cost depends on the policy amount, the insured’s health and age, and how long the rate is guaranteed. This is a good type of policy if you want the maximum insurance amount for the premium paid. It is also good when the insurance is only wanted for a certain time. For example until the mortgage is paid or until the children are on their own.

Whole life, also called a permanent policy, is designed to be lifelong policy. As long as the premium is paid the death benefit will always be there. In addition these policies also build cash value over time. The cash value generally earns interest at a preset rate. There are many varieties of this type of policy. One popular version is the “universal” policy that allows flexibility of the term life amount and the amount of premium paid. For a person desiring life insurance for many years the permanent policy may have a lower total cost. Because a life policy may be held for a long time it is important to deal with a very solid company. It is advisable to have a experienced agent help you determine your needs. A good agent should also be able to show you different options to help you find what is best for you.

Glenn Lamb is an insurance agent and owner of the Lamb Insurance Agency, Auto, Home, Life, and Business Insurance for Texas

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