Today’s economy is looking up, and there are countless jobs available now. However, the focus is moving towards the areas of savings and retirement plans that include life insurance coverage. If you are planning to shop for life insurance plans, what are the features you have to look for? If you are young and single and earning just for your daily needs, life insurance can’t be a pressing concern. On the other hand, if the income you earn is vital for your loved and related ones, let it be your child, spouse or even an aging parent. It is your responsibility to plan for a consistent solution. This article can help you to get a fair idea of choosing the right life insurance plans for you.
According to a survey taken during late 2012, four among ten Americans do not have a life insurance policy, and also one-third of those who possess an insurance coverage would say that they are not completely aware of the terms and policies. It’s now time to change that if you are among the above-said groups. As you know, similar to the disability insurance, life insurance plans are an effective way to protect your loved ones. You may note that life insurance plans are the most affordable option if you are younger, in your good health and opt for simple “term” life insurance policy.
The term insurance policy offers the scheme that has a fixed, regular premium in exchange for a guaranteed benefit, in case if you die during a term of next 20 years or something. Considering a vast majority of cases out there, this policy is best of its kind. The top reasons are given here:
Easy comparisons
The term life policy can be easily compared to other insurance providers, mainly because of its unique, straightforward conditions. You have a fixed premium, a specific period and a benefit, that’s all.
Focused but the cheapest
The term life can be easily explained as a life insurance product and nothing more. This policy allows you in being more flexible when dealing with other financial products; you can shop it separately for your best fit and best price instead of those completed agreements which are structured in a complicated way that may not be your best option. It’s worth noting. However, term life is being passed over consistently and more frequently in recent years mainly because of the modern trend of Americans to start shopping for life insurance again. One of the best advisory group in the field of life and health insurance industry Life Health Pro brings out a point to be noted that universal life insurance and whole life insurance, both schemes have gained significantly across the calendar 2012 but the sale of term life was down.
It has to be closely observed that how these products vary from the term life insurance plan policy. The ‘Whole Life Insurance Policy’ as the name indicates, lasts for the insurer’s entire span of life instead of a set term and it develops in value over time to a final benefit at the time of death. A term life insurance can leave you with absolutely nothing after you have paid the 20 years premium amount. It’s because of this reason; some opt for the option of cashing out a portion of Whole Life Insurance Policy early from the complete death at the time of any emergency requirements for money. It’s obvious that you are paying a premium for this life insurance plan and certainly if you cash out early, you have to incur huge penalties and finally ending up with very little money in your pocket.
The Universal life insurance is somewhat similar but in a more structured way that the policyholders have to pay higher than their base insurance costs for building up a high-interest investment or savings account. We recommend you to consider this as a hybrid investment or insurance plan. You can pay relatively high fees for this kind of life insurance plan, but there is no guarantee that any of your investments will perform great. It seems that the huge costs and risks of such plans either aren’t a problem or most of the policyholders are unaware of this.
Indexed Universal Life
This is where that extra money is put into stock market index such as S&P 500. It now makes up to 28 percent of the entire life insurance coverage market. Currently, S&P is on its hike, keeping all time targets and soaring up to 140 percent since its depreciation in 2009. The policyholders of Indexed Universal Life seems much satisfied and are pretty happy. Even though some of the S&P companies are charging as low as $2 or $3 for every investment of $10, while you may pay commissions and fees as high as 100% of your premium on the first year in the case of complex insurance hybrids.
