Life Insurance 101 – Types of Life Insurance

Life Insurance Awareness Month #LIAM

Life Insurance at a high level can be divided into 2 categories: Term and Perm. Under each of those categories there are a few choices of products.

Most popular products under those categories and in the order of cost are:

$ 1. Accident Only – usually good till age 80
$$ 2. Term Life – sold in segments 10y, 15y, 20y, 25y, 30y
$$$ 3. Universal Life – considered a hybrid of term & whole life.
$$$$ 4. Whole Life – exactly as stated. Covers till age 121.

Accident and Term Life insurance are the most affordable options but there is no cash value accumulation. Some carriers may offer Return of Premium as an offset. These products are most attractive to people who are starting with Life Insurance and/or are looking for temporary protection.

Universal and Whole Life insurance offer guaranteed and non-guaranteed cash value accumulation. These are more attractive to people looking to save money for future use as the interest rate growth is significantly higher than what a bank can offer.

During the month, I’ll take the time to dissect each type of product with their pros and cons. I will also expand on the riders a client can select for extra protection.

To answer the frequent question of “Which one is better?” I would have to say that it definitely depends on these lucky 7 factors:

– Your Needs
– Your Budget
– Your Assets
– Your Goals
– Your Knowledge
– Your Age
– Your Health

All of the above points play a part on which recommendation type I would give you. And it does require an open and honest consultation of where you are today and where you are going.

Which one of these types of Life Insurance are you most intrigued about?

Voice it in the comments 😊

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