Life Insurance – Finding the right policy

on the contrary to a multitude of myths related to insurance, including the one that says buying insurance becomes an arduous task as individual ages, the truth is that it is probably one of the easiest tasks and simplest solutions to cover a life. Most of us do not like to talk about our death and illness; nevertheless it is quite imperative to think about it. Life insurance is likely one of the best decisions that you can take in order to secure the future of your loved ones in event of your unfortunate death or if a major illness strikes.

Types of Life Insurance:

The amount of insurance needed is based on the needs/goals of the person applying for it.  There are different kinds of insurance policies to choose from and here is a look at each one of them from the eyes of insurance expert Yong Wai Meng.

Life Insurance

Term Life Insurance:  This type of insurance is set up to provide financial security over a specific time frame of 10 to 20 years.  Premiums are evenly distributed over a period of time and guaranteed for that period.  Policies can offer extended coverage beyond the specified period for a higher premium.  This is a cheaper option as compared to permanent life policies.  This type of insurance helps people make up for lost income as well as a safety net for beneficiaries of the policy.

Universal Life Insurance: This is a different type of insurance which is tailored to provide overage over a lifetime.  The policies are flexible and premiums can be increased or lowered over a person’s lifetime.  Payments are tax deferred and help people to build up savings.  People can choose to get death benefits as well as cash or just death benefit coverage.

Whole Life Insurance: A type of permanent insurance which provides lifetime coverage.  Premiums are usually higher and fixed.  It has cash value and acts as a savings account for people and offers tax benefits over a period of time.  Many people use this to build up savings and avoid paying taxes – a good estate planning tool which transfers wealth to beneficiaries mentioned in the policy.

How insurance costs are calculated:

Life Insurance companies use different classifications to determine the premiums a person will pay.  Categories don’t impact the amount or the length of coverage a person is entitled to.