Life insurance is a contract between insurance company and policyholder in which insurer guarantees the payment of death benefit to named beneficiaries upon the death of the insured. Death benefits are the amount of money insurance company guarantees to the beneficiaries stipulated in the policy upon the insured’s death. Life insurance ( https://www.harringroup.com/ ) cannot bring your loved one back, but it can help you a lot provide you with financial security.
Types of life insurance
Life insurance is of two types- Term life insurance and Permanent life insurance. Term life insurance is a temporary policy, and permanent life insurance is for the lifetime. Most common types of permanent life insurance are whole life insurance, universal life insurance, and variable universal life insurance.
Term life insurance
Term life insurance is a temporary policy designed to provide protection for a specific period of time such as 10, 15 or 20 years. Premium payment amount remains the same throughout the coverage period in term life insurance. It is less expensive than permanent life insurance. This type of insurance is good for people who need life insurance for a specific period of time. You may continue your policy at a higher premium after the end of the coverage period.
Whole life insurance
Whole life insurance is a type of permanent life insurance that provides protection for a lifetime. Whole life insurance has a higher premium than term life insurance because policy provides coverage for the lifetime. Premium in whole life insurance remains the same throughout the coverage period. Whole life insurance offers both a death benefit and cash value. Cash value function as a savings component and may accumulate tax-deferred over time.
Universal life insurance
Universal life insurance is also a type of permanent life insurance designed to provide protection for a lifetime. Unlike whole life insurance, universal life insurance policies are flexible and provide you the freedom to raise or lower your premium payment throughout your lifetime. Universal life insurance in Texas ( harringroup.com/life-insurance ) also offers both a death benefit and cash value. This type of insurance can earn interest and build cash value over time.
How much life insurance costs?
The cost of life insurance depends on several factors including how much you buy, the underwriter's practices, the type of policy you choose, and how much commission the company pays your agent. Term life insurance policies are cheaper than permanent life insurance policies. For example, a healthy 30-year-old man could expect to pay $300 per year to get the coverage of $300,000 in term life insurance. To get the same coverage in permanent life insurance, one has to pay over $3,000 per year.
So these are the things you need to learn about life insurance in Texas.