| Life insurance, at its core, is a means to protect | | | | Whole life insurance policies were long "the norm" |
| the financial security of one's survivors. It is | | | | in the insurance industry.Universal Life |
| generally thought of as a way to provide income | | | | InsuranceUniversal Life Insurance is considered a |
| replacement for a wage earner's survivors in the | | | | more flexible approach to life insurance. The |
| event of death. Life insurance is purchased from | | | | required regular premium amount can vary as |
| an insurer by making regular payments of | | | | long as the policy has a cash value in excess of |
| premiums during the life of the insured. Upon the | | | | the policy's costs. The insured can alter the |
| death of the insured, designated beneficiaries | | | | policy's future payout while the policy remains in |
| receive a financial benefit.Although all life insurance | | | | force, making it a flexible insurance solution for |
| policies maintain those consistent characteristics, | | | | those who may have more complicated or |
| there are different means to achieving the same | | | | rapidly-changing needs than can be addressed with |
| end. Four distinct types of life insurance have | | | | term or whole life solutions.Variable Universal Life |
| been developed and are in common usage.Term | | | | InsuranceVariable Universal Life Insurance takes |
| Life InsuranceTerm life insurance is probably the | | | | the flexibility of universal life coverage and adds |
| most basic form of life insurance. Term insurance | | | | to it by providing investment choices. The policy's |
| is purchased for a specific period of time (the | | | | cash value is not based simply on an interest rate |
| term). The length of the term can vary | | | | determined by the insurer. Instead, the policy's |
| considerably. There are term policies that are | | | | value is based upon the performance of various |
| effective for well over twenty years, whereas | | | | investments. The insured allocates his premiums |
| some only involve a one-year term. A regular | | | | among a series of investment options with a |
| premium is paid throughout the term. If the | | | | variable universal life insurance policy.Although all |
| insured dies at any point during the term, the | | | | insurance policies do share common |
| designated beneficiary receives the death benefit. | | | | characteristics, the four different types of |
| If one survives the term, however, there is no | | | | insurance policies have some marked differences. |
| payout and the policy simply ends.Whole Life | | | | Each type of insurance policy has advantages and |
| InsuranceWhole life insurance has a long history | | | | limitations. For some, a simple term policy will |
| and maintains great popularity. The cost of | | | | more than suffice to meet their life insurance |
| premiums is guaranteed for the entire time the | | | | needs. Others may benefit considerably from a |
| policy in place. As premiums are paid, the insured | | | | more full-featured insurance policy that includes an |
| accumulates a cash value for the policy, with the | | | | investment component and the ability to alter the |
| insurer determining the interest rate applied to | | | | nature of benefits and the premium.Evan C Davis |
| that cash value. One may either "cash out" their | | | | works in Medicare customer service, and is the |
| whole life policy, or maintain it so that benefits are | | | | webmaster and owner of Instant Health |
| paid to survivors upon the policyholder's death. | | | | Insurance. |