Many people are between the benefits and life insurance,
whole life insurance provides intelligent. Enjoy the accessibility of
imprisonment. They also love its flexibility. Temporary be canceled without
significant penalty life insurance, and news began several different death
benefits and higher amounts.
On the other hand, life offers something for protection
against the risks non-life to death. The policy does not expire after a number
of years, because the concept of life, so that consumers do not have to new
reports. As a result, the cover can not be denied that in the future due to age
or illness. Premiums will not increase. Because of these guarantees, but life
is not flexible. The death benefit and the premium is determined at the time of
signing the contract.
The solution for many people is a universal life insurance.
Universal life has been described as a hybrid between the life and words of
life, but this is a misnomer. Universal life insurance is a type of insurance
for life. This allows greater flexibility and lower costs for traditional life,
but shares characteristics of life: continuous coverage, premiums do not change
for reasons of age or health, and the accumulation of value redemption.
The main difference between the life and words of life is
the life of the hedge. With Standard Life insurance coverage is limited at a
certain period of the term. At some point, either the coverage expires or
insured. If the insured dies during the term, the death benefit paid to the
beneficiary. If the insured survives the term coverage will cease at the end
date of the policy. Some term life be renewed without physical examination, but
premiums increase with age of the insured at the time of renewal. With a
lifetime to continue indefinitely until the insured dies coverage. Universal
life insurance shares this property with life insurance. Both are permanent
life insurance forms.
A person can cover a number of life insurance policies for
eighty or ninety. If an individual term life insurance is renewed or a new
request, but the cost of insurance increases, due to increased mortality in the
elderly. For example, for a 30-year term insurance for one 20 $ 500 000 years
to life for only $ 245 per year, assuming he is healthy, do not smoke, do not
participate in sports or extreme activities leisure and travel in dangerous
areas of the world. However, serve a 60-year-old health and in similar
circumstances, other criteria must always be at least U.S. $ 2,525 per year for
the same 20 years $ 500,000 policies. At age 70, $ 10.680 per year will pay for
the same policy. If a person develops health problems during the time that the
expression of the life insurance premiums do not change. If the person does not
have a term life insurance "renewable", then when the time and the
person who made the request for term life insurance coverage, increase premiums
significantly. If the person has developed or has suffered serious health
problems such as cancer or a heart attack, he or she may not be insurable at
all.
Not to increase the cost of the permanent life insurance
policy over time or changes in health care. Coverage can not be completed, no
matter what health problems have insured. Guaranteed insurability is the
highest cost of permanent life insurance.
Another important difference between term life insurance and
whole life insurance is that life offers saving features, while life is not the
end. Term life insurance is "pure". It insured against death, and
that's all. Life also insured against death, but also provides a mechanism for
the accumulation of cash value or savings. Universal Life also offers saving
features.
Early in the life of a whole life or universal life
insurance, the cost of insurance against premature death is much less than the
amount of the premium. Fewer benefits and rights of society - in a tax-advantaged
savings account, the insurance company to file the excess. This amount is known
as "cash value." These funds are invested by the insurance company.
Investment income is credited to the account, which increases the current
value. These funds are available to the insured in the form of a loan or
withdrawal. If the insured cancels the contract, you will get the value of the
money that the policy of "cash value."
Universal through the difference in the degree of
flexibility of the life insurance policy should make adjustments. With whole
life, the death benefit is determined premium and the value of the accumulation
of cash at the outset. With universal life, the insured has the option to
increase or decrease the amount of the premium (within certain limits) and
increase or decrease the death benefit. For example, the policyholder can
reduce premiums if the starting price priceless. If the insured wishes to
accumulate or increase the death benefit plus the cash value, he or she may pay
a higher premium.
