Posts Tagged ‘Permanent’

Know About The Basic Difference Between Permanent Life Insurance And Term Life Insurance Policy.

Article by David Livingston









Both of them provide death benefit on the death of the insured, yet there is a basic difference between whole or universal life insurance and term life insurance policy. Let us examine that:

The whole or universal life insurance policies are valid for the life of the insured. However, term life realizes that nobody needs lifelong insurance coverage and so it is sold for a fixed term only.

The premium you pay in a term life does not buy you anything other than death benefit; but in a permanent life insurance policy, a part of the premium is diverted to a separate account to develop the cash value.

Consequently, the term life cannot offer you any investment opportunity, but since the whole amount is utilized to develop the face amount, you can have a large death benefit at a low rate. Contrarily, the permanent life insurance policies provide financial benefits in your lifetime only; but the death benefit they offer is comparatively much less.

Choosing the right kind of policy becomes easier if we have a clear idea about such differences. Being aware about the working of each policy is also important. It is sad that in these days of consumer awareness, a life insurance policy is bought rather blindly. Indeed, people generally buy whatever their agent or broker recommends and they recommend what suits them most. Consequently, you are often laden with least suitable policy.

If you actually care for your family, you should put a little more effort in selecting the right kind of life insurance policy. Many online articles provide detailed information about different life insurance policies; read them. Quotes too can provide quite a lot of information, if you care to study them carefully. Of course, the process of policy purchase always starts with receiving quotes. Always receive life insurance quote on line; that is the easiest way to do that.

Along with choosing the right kind of policy, choosing the right insurer is important too. Make sure that the carrier is financially healthy and its claim payment record is impeccable too. You can check all these through credit rating companies. Do not neglect it or if you die premature, your family will have to run from pillar to post to get what is their due. Apart from, you too must do your part well. Negligence on your part may also result in non-payment or at least delayed payment of claims.

Now, let us go back to where we started. Choosing the right kind of policy is essential. You may find it surprising; experts today recommend only term life for insurance purposes. They say that the whole or universal life is suitable for only those, who do not have any kind of financial discipline. You see, a term life is far cheaper than these permanent policies; if you only put in the difference in their rates in suitable investment fund, you will get a much better return.

What is more, should you indeed die while a term life is still in force, your beneficiary will get both the death benefit and the investment amount. In case of whole or universal life policy, the insurers will pay only the death benefit. Indeed, with death or endowment, the insurance companies always keep cash value built up using your money. That is why, if insurance is your main aim, go online to receive cheap term life insurance quotes and start the process of purchase.

However, how cheap the term life insurance quotes will be, partially depends on you too. If you are already on the wrong side of fifty, you can never get the coverage at cheap rate. To receive cheap term life insurance quotes you have to be young and healthy with the right body mass index. Moreover, you must not use tobacco in any form; your and your family’s medical history should also be all right; most of all, you must apply for a traditional term life insurance policy. No medical term life insurance may be convenient, but it is also rather expensive.

You must realize the policy prices depend mainly on the insurability of the person and the insurability depends on lot of factors such as your age, gender, tobacco use, whether or not you are suffering from certain diseases as well as hereditary factors. Although the insurers can have a partial picture about your insurability through medical banks and other agency reports, without the medical exam, they cannot come to any definite conclusion. That is why such partially underwritten policies are rather expensive. Yes, they provide instant coverage and there is not much hassle involved in the policy purchase. However, if rates are an issue, you must avoid them at any cost.



About the Author

Article by David Livingston of EQuote, who is a specialist in everything life insurance. For more information on term life insurance

Uses of Permanent Life Insurance

Article by Denise Mancini









Permanent life insurance implies insurance that you keep for life. As long as you keep paying the premiums, the insurance does not expire. In comparison, term life insurance covers you only for a specified period of time and all death benefits are waived off if you outlive your term. The two most common types of permanent life policies are whole life and universal life insurance. These policies also accumulate cash value along with the death benefits. This cash value can even be borrowed against or en-cashed while you are still alive. Policy holders can use this money to pay for their children’s education, fund their retirement or in case of any emergency. When compared to term life insurance, permanent life insurance coverage costs significantly more in the early stages of the policy but becomes more economical as the years go by. There are two main types of permanent life insurance – whole and universal:Whole Life Insurance – Whole Life Insurance offers coverage for your entire life. After your death your beneficiaries will receive the cash benefits of the policy that can be used to pay off your taxes, mortgage, estate settlement claims etc. As a rule, whole life insurance premiums do not fluctuate. Unlike term life policies that cost more as you grow older (except for level term), with whole life insurance, the costs are averaged out over the period of the policy.Whole Life Insurance also accrues a cash value over the life of the policy that is tax-free. If you cancel your policy or borrow against its value, you can use this cash value as well. The rate of growth of the cash value depends on a number of factors such as the investment success rate of the your insurance company.The advantages of whole life insurance would therefore include a fixed premium that doesn’t increase over the period of the policy, the payment of death benefits to your beneficiary, a cash value component that you can borrow or surrender during your lifetime and finally the option to receive dividends from your policy. On the other hand, whole life insurance doesn’t offer the flexibility to invest in separate investment accounts or split your money between accounts. Neither does it offer premium or face amount flexibility.Universal Life Insurance – A life insurance policy has three key elements to it – the premium, the coverage, and where the insurance company invests the cash value component of your policy. Universal life Insurance offers you control over all these elements. As time passes, your needs for financial security and insurance protection will naturally change. Universal life insurance gives you the flexibility to alter the different components of your policy to suit your needs at the time. For example, if you are experiencing a cash crunch, you can reduce your premium amount. Alternatively, if you are enjoying a secure period with your funds, you can increase your premiums and thus increase the investment value of your policy as well. Variable universal life insurance allows you to also control how your money – in what stocks, mutual funds, and bonds. However, unless you are well versed and confident about the markets, this sort of policy is not recommended.Universal life insurance therefore allows you both premium and face amount flexibility, it allows you to borrow or en-cash from your policy within your lifetime, it pays your beneficiaries the death benefits allows you to earn market rates of interest on your cash value account. It however, doesn’t let you split your money between accounts or invest in separate investment accounts.Permanent life insurance is definitely a valuable addition in terms of its death benefits but one of the main uses of a permanent life policy is its living benefit. A permanent life insurance policy will help you while you are still alive by helping you pay for your children’s education, your first home, a medical emergency or even a wedding. When purchasing a permanent life policy, one tends to only think of the advantages offered after death but if we start thinking of the uses of such a policy within our lifetime, it might just change the way we look at life insurance today.About AccuQuote:AccuQuote is a leader in providing term life quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the most affordable term life insurance rates by

Reasons to Convert Term Life Insurance to Permanent Life Insurance

Term life insurance may make sense now, when funds are low and insurance needs are high. But this may not be the case a few years down the road. That’s why when you purchase term life insurance you should make sure there is a convertibility option within your contract. A convertibility option allows you to convert your term life policy into a whole life policy within a stipulated time frame, without having to prove insurability. When your financial position becomes more stable, you may want to opt for whole life insurance that adds a savings component to your policy. Your premiums accrue interest while providing your family with life insurance coverage.

Advantage of Whole Life Insurance

The first question that comes to mind when considering conversion from a term life insurance policy to whole life is: Why would I trade in my inexpensive term life insurance policy for a more expensive whole life policy? You’re not! Whole life has several advantages over term life insurance and there are good reasons why you should consider converting your term life insurance policy to whole or permanent life insurance:

Whole life has a savings component. A portion of the premiums you pay accrues interest which adds to the face value of your coverage.
As you age, life insurance companies consider you to be at higher risk of death. Therefore, premiums go up. If you suffer from any health issues, your premium rates will go up even further. If your term life insurance ends when you are say, 50 years of age, and you still feel the need for life insurance (most people do, at least to cover funeral expenses, etc), life insurance at this age may become an expensive proposition.
With whole life insurance, premiums remain steady throughout life. Since you do not have to worry about your policy terminating after a certain term period, you need not worry about worsening health conditions or increasing age affecting your premium rates.
If you’re hard up on cash, you can borrow money from your whole life policy up to a certain amount, without any questions asked.
Whole life insurance offers lifetime coverage. You must pay premiums up to the age of 100, but when your whole life policy reaches a certain maturity level you can use the interest accrued to pay premiums. If you are still alive after the age of 100, you need not pay premiums but your coverage is still in effect.
The interest accrued along with the face value of the insurance policy is tax-deferred.

Term Life Insurance – Advantages of a Convertibility Option

]]>

By using your convertibility option you will be able to convert your term life insurance policy to whole life without have to prove insurability. This means you do not need to go through a medical examination. However, your premiums may go up based on your age at the time of conversion or, in some cases, premiums may be calculated on the age you were when you originally purchased the policy.

You have the option to convert all or a portion of your coverage to a whole life policy. For instance if you purchased a 0,000 term life insurance policy, you could convert 0,00 to a whole life insurance policy and keep your term life insurance coverage at 0,000.

Most term life insurance policies with a convertibility option stipulate a time period within which a term life insurance policy can be converted to whole life. It may be a specified time period after the policy has been issued, or before the policy owner turns a certain age. Before you decide to convert your term life insurance to whole life, you should take financial stock of your life and assess your probable financial position in years to come. Ask yourself questions such as: Do you expect your insurance needs to diminish as time elapses? Do you expect to pay off all your debts before you reach retirement age? Based on your family health history, do you expect any changes in your health as you age? Will you be able to leave enough money behind to pay off your funeral expenses and estate taxes, if any? Many people like to use a life insurance policy to leave wealth behind to their children or grandchildren. Consider your needs and how converting from term life insurance to whole life would benefit you and your family.

What if your term life insurance does not have a convertibility option?

If your term life insurance policy does not have a convertibility option, switch to one which

Reasons to Convert Term Life Insurance to Permanent Life Insurance

Article by Denise







Term life insurance may make sense now, when funds are low and insurance needs are high. But this may not be the case a few years down the road. That’s why when you purchase term insurance you should make sure there is a convertibility option within your contract. A convertibility option allows you to convert your term life policy into a whole life policy within a stipulated time frame, without having to prove insurability. When your financial position becomes more stable, you may want to opt for whole life insurance that adds a savings component to your policy. Your premiums accrue interest while providing your family with life insurance coverage.Advantage of Whole InsuranceThe first question that comes to mind when considering conversion from a term insurance policy to whole life is: Why would I trade in my inexpensive term life insurance policy for a more expensive whole life policy? You’re not! Whole life has several advantages over term life and there are good reasons why you should consider converting your term life insurance policy to whole or permanent life insurance:

Whole life has a savings component. A portion of the premiums you pay accrues interest which adds to the face value of your coverage.As you age, life insurance companies consider you to be at higher risk of death. Therefore, premiums go up. If you suffer from any health issues, your premium rates will go up even further. If your term insurance ends when you are say, 50 years of age, and you still feel the need for life insurance (most people do, at least to cover funeral expenses, etc), life insurance at this age may become an expensive proposition.With whole life insurance, premiums remain steady throughout life. Since you do not have to worry about your policy terminating after a certain term period, you need not worry about worsening health conditions or increasing age affecting your premium rates.If you’re hard up on cash, you can borrow money from your whole life policy up to a certain amount, without any questions asked.Whole life insurance offers lifetime coverage. You must pay premiums up to the age of 100, but when your whole life policy reaches a certain maturity level you can use the interest accrued to pay premiums. If you are still alive after the age of 100, you need not pay premiums but your coverage is still in effect.The interest accrued along with the face value of the insurance policy is tax-deferred.Term Life Insurance – Advantages of a Convertibility OptionBy using your convertibility option you will be able to convert your term insurance policy to whole life without have to prove insurability. This means you do not need to go through a medical examination. However, your premiums may go up based on your age at the time of conversion or, in some cases, premiums may be calculated on the age you were when you originally purchased the policy.You have the option to convert all or a portion of your coverage to a whole life policy. For instance if you purchased a 0,000 term insurance policy, you could convert 0,00 to a whole life policy and keep your term insurance coverage at 0,000.Most term life insurance policies with a convertibility option stipulate a time period within which a term life insurance policy can be converted to whole life. It may be a specified time period after the policy has been issued, or before the policy owner turns a certain age. Before you decide to convert your term insurance to whole life, you should take financial stock of your life and assess your probable financial position in years to come. Ask yourself questions such as: Do you expect your insurance needs to diminish as time elapses? Do you expect to pay off all your debts before you reach retirement age? Based on your family health history, do you expect any changes in your health as you age? Will you be able to leave enough money behind to pay off your funeral expenses and estate taxes, if any? Many people like to use a life insurance policy to leave wealth behind to their children or grandchildren. Consider your needs and how converting from term insurance to whole life would benefit you and your family.What if your term life insurance does not have a convertibility option?If your term insurance policy does not have a convertibility option, switch to one which does. You’ll find the best rates for term insurance online. Ask for free quotes on reliable site certified by the Better Business Bureau. This will give you opportunity to evaluate prices, look for free riders, and compare company ratings. Since such sites have a huge database of reputed life insurance carriers offering competitive rates, chances are you’ll find a term insurance with a convertibility option that is cheaper than your

Permanent Life Insurance: Worth the Money?

Article by Denise Mancini







Buying life insurance requires a lot of thought and planning. For most people, the choice is between a permanent life policy and a term life policy. Here’s a bit of information on permanent life insurance to help you make a better-informed decision.Permanent life explainedPermanent life insurance will remain in effect until the insured dies, after which the death benefits will be paid out to the beneficiaries. The premiums on permanent life are designed to remain equal throughout the life of the insured. Premiums are high because permanent life policies develop cash values that can be accessed by the insured through surrenders or through loans against the policy.The cash values in permanent life insurance policies typically include two components:

A guaranteed cash value, already referred to above. The cash value grows based on a pre-set schedule, and grows to a sizeable amount upon maturity of the policy (typically at age 100).Most permanent life insurance policies additionally have a non-guaranteed cash value element, typically made up of dividends or earnings on the cash value, which can enhance the value of the life insurance policy over time.There are many permanent life policies in the market today with varying features and varying degrees of control over the cash value component of premiums.Permanent life vs term lifeIn sharp contrast to all the cash-value possibilities that permanent life can offer, term life insurance policies only offer you the death benefit, and only cover you for a particular number of years, called the ‘term’. Because of the absence of cash values and the temporary nature of this policy, term life premiums are more affordable.Permanent life insurance can be substantially more expensive than term life insurance, but the death benefit is guaranteed as long as premiums are paid. On the other hand term life policies can buy you the same amount of death benefit as a permanent life insurance policy, at a fraction of the premium cost.The pros and cons of permanent life insuranceThe drawbacks of permanent life insurance are:With most permanent life insurance policies, you don’t have a say in the investment portfolio to which your cash value component is linked. Because of its investment component, the best benefits on a permanent life policy are gained in the long term. So this is not a great life insurance policy for someone who wants a stopgap life insurance policy.If you fall short of funds the cash value portion of permanent life policy can be borrowed against. This attracts interest, so it is advisable not to borrow against a permanent life policy unless it’s a last-resort effort to access money during a tough financial situation.The investments of most permanent life insurance policies are by nature very conservative (variable permanent life policies are the exception) with a strong possibility that if you were to invest the same amount of money elsewhere, you would earn much more on your investments. In fact there is a school of thought that advocates that permanent life insurance may not be worth the money at all when compared to the benefits of buying term and investing the difference in premiums (between term and permanent).Let’s move on to the advantages of permanent life.If you have difficulty exercising discipline in money matters, permanent life is a great option because it offers you ‘forced savings’. If not for the policy, you probably would have difficulty investing money so consistently into an investment avenue.Permanent life is a life-long insurance policy and the premiums are consistently level. Though it can be quite a pinch in the first few decades of your policy, as the years pass, it can get more affordable.When you outlive a term life policy, you will need to buy more insurance, predictably at higher premiums. This problem does not arise in permanent life because the policy is lifelong, and premiums are consistently equal.Is permanent life insurance right for you?It all boils down to the life insurance needs at your current stage in life. If you are very young and have several financial obligations such as small kids, their college education to think of, mortgages, loans, etc. then permanent life policies may not be right for you just yet because of their high premium costs. Term life would be a lot better. On the other hand, if you are older, and are mostly done with your financial obligations you will need a life insurance policy to cover you for the rest of your life, and that’s where permanent life seems the more feasible choice.How long do you plan to keep your life insurance policy? If you want to be insured for several decades, you have to think of permanent life and not term, because

What type? Permanent or term life insurance?

Article by Denise







Now that you are ready to purchase life insurance, the choice before you is what type of life insurance would best suit your purpose. Life insurance is not a one-size-fits-all product and each one must assess his or her own personal situation to come up with the right coverage and the number of years you would need that coverage. The two broad categories of insurance open to you are permanent or term insurance. Let’s take a look at each one.Term life insuranceThis is the simplest type of life insurance and is often considered to be insurance at its best. You pay a certain amount of premium against a death benefit amount (coverage) that your family would receive in case you die during the tenure of the term insurance policy. Term insurance is temporary. This means you can purchase a policy for a period of term, say, 5, 10, 15, 20 years or even longer. You pay premiums monthly or annually. Annual payments work out to be cheaper than paying premiums every month. There is no savings element involved. If you should outlive the policy, the money you have paid towards premiums is gone. To avoid this, life insurance companies also offer a type of term insurance called return of premium. At the end of the term period, if you are still alive, all the premiums you have paid will be refunded to you, tax free. There are several types of term life policies, such as level term life. Level term assures that your premiums remain level, or the same, during the entire term period. This avoids any unexpected hikes in premiums during your term period that you had not planned for.Since term life is temporary it is the cheapest insurance you can purchase. For example, a 40-year old male who is in top health, living in California can get term insurance for as little as 0.00.To summarize, here are the main features of a term insurance policy:

Term life is temporary life insurance and can be purchased for a specific term period. After the term period is over, you would need to renew the policy if you still feel you need to be insured.Term insurance is the most affordable.There is no savings element involved.Term life can be renewable – look for renewable options that do not require you to prove your insurability after the term period is over.You can purchase term insurance at a cheap rate right now and convert to a permanent life policy at a later date. You would need to look for a term life policy that offers you this conversion option.Permanent Life InsurancePermanent insurance (also called whole life insurance) offers lifelong protection. It is more expensive than term insurance because, along with insurance coverage, there is a savings component attached to it. For the first ten years, your permanent life policy will not accrue much interest. Much of the interest will be used to pay off administrative fees. You cash value will only kick off after that.Another benefit to owning a permanent life policy is that you can borrow from it anytime you need cash. Interest rates are high, but should you need the money, you are able to take a loan against your whole life policy.To summarize, here are the main features of a permanent life insurance policy:Permanent life offers life insurance protection for your entire life provided you pay your premiums.It is more expensive than term insurance, but offers a cash value component not found in term insurance.You can take out a loan against a permanent life policy.The premiums remain the same throughout your life.Permanent or Term Insurance?Most experts recommend that you purchase a term life policy and invest the difference (between term and permanent) in a separate investment instrument. This is more likely to fetch you more money on interest than a permanent life policy would. Others also suggest that life insurance is not something you need for a life time. Growing families, in particular, who have limited income, prefer term insurance because it is the most affordable and meets their coverage needs most satisfactorily. If you are looking for cheap life insurance from some of the most financially strong life insurance carriers in the industry, request for free insurance quotes online. Comparing multiple term life insurance quotes online is quick and convenient. Some websites also offer professional guidance to help you make an informed decision.About AccuQuote:AccuQuote is a leader in providing term life insurance quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term insurance as easy as possible for its customers. Their

Free T-Mobile Phones on Sale | Thanks to CD Rates, Best New Business and Registry Software