Making some comparisons.

There are various types of life insurance policies offered by the insurance companies. Making a life insurance comparison can insure that you are choosing the best policy to fit your needs. There are four main types of life insurance: term life, whole life, variable life, and universal life. A term life insurance policy pays out a predetermined amount if death occurs to the insured within a certain number of years set by the policy. For example, you might purchase a policy with a pay out of $50,000 if you pass away within the 30 years the policy is active. If you pass away after the 30 years, your beneficiary will not receive the insurance benefits. If you want to continue coverage after the policy has expired you must renew the policy.

Unlike term life insurance, a whole life insurance policy covers you for your entire life. There is no predetermined amount of time the policy is active. It is active as long as you are alive and is terminated only on your death after the benefits are paid to your beneficiary. The monthly payments tend to be lower when you first purchase the policy and increase as you age. The benefits remain the same throughout the life of the policy unless you increase the monetary value of the policy. Many insurance companies require an initial medical exam but usually do not require follow-up exams to maintain the policy.

A term life policy and a whole life policy have a preset benefit amount determined at the time you purchase the policy. A universal policy offers more flexible options with the ability to invest a portion of the policy. With a universal policy the benefit amount is determined by the value of the policy at the time of the insured’s death. With a life insurance comparison, think of it this way: only a portion of the policy is invested and there are tax credits available for the money invested. Like a universal policy, a variable life policy allows of the policy to be invested. However, a variable life policy offers a more flexible plan giving you more control over how much of the policy you wish to invest. With a variable life policy the monthly payment is determined by the value of the portion of the policy tied up in investments. If the investment portion is doing well the monthly payment will be lower. However, if the invested portion is performing poorly then the monthly payment will be higher. The experts within the industry agree that you should seek a minimum of three quotes from multiple providers.