There are many types of life insurance policies. You should choose a policy with features that fit your individual needs. Here are some things to consider:
Term insurance is intended to provide lower cost coverage for a specific period of time (“a term”).
If you want coverage for a longer period of time, such as for your lifetime, cash value insurance may be more cost effective.
Most term policies don’t build up cash values that you can use in the future.
Most term life insurance coverage can be continued (“renewed”) at the end of the term, even if your health has changed.
If you renew a term policy, the new premiums are higher. Ask what the premiums will be before you renew the policy. Also ask if you’ll lose the right to renew the policy at a certain age.
A nonrenewable term policy can’t be continued. You’ll have to apply for a new policy if you still want coverage.
Whole life and universal life insurance are two types of cash value insurance.
A key difference between the two is how you pay for the coverage. You typically pay premiums for whole life insurance according to a set schedule.
In a universal life policy, you can choose a flexible premium payment pattern as long as you pay enough to keep your policy in force.
