By Jacob Maslow–Branded Content

Life insurance is there to protect your family should anything unexpected happen. However, choosing life insurance can be a confusing process as there are so many different policies available, each with various benefits and conditions. To make the process easier, we have explained some of the policies available. 

Term Life Insurance

Term life insurance is exactly as the name implies: your policy is for a set amount of time, usually between 10 and 30 years. It has no cash value but will give your beneficiaries a cash payout if you die. Most of these policies have premiums, so you pay the same amount each month. However, you will have to obtain a new one when the policy expires, likely at a higher expense as rates are based on age and will increase as you get older. 

Whole Life Insurance

This is the simplest form of life insurance and provides coverage for your entire life. A part of your premiums is placed in a cash value account that will gradually increase over time. Initially, this form of policy will not be worth much, however as it grows into more significant amounts, you will be able to borrow against it. You also have the option of selling your policy for a lump sum of money that can help you in retirement. You can take a look at a guide online that tells you everything you need to know about selling your policy. 

Universal Life Insurance

A form of permanent insurance that offers the same benefits as whole life insurance. However, the significant difference is that the premiums you pay are flexible. You can raise or lower the amount you are paying into your account. You must be aware that if you pay less, you may have to pay more later on to keep your coverage. This policy is most useful when you take into account changing lifestyle circumstances where you may need to adjust your spending or give yourself and your family better coverage. 

Final Expense Insurance

This policy will pay for the expenses of burial and a funeral. The policy is permanent as long as you keep paying the premiums. However, there is no other cash payout on death. This may be useful for older people who are concerned about the costs when they die. If you are younger and are looking for a policy that will support your beneficiaries, this will not be a good choice. The payments you make are modest, but the circumstances it covers are also minimal. 

Group Life Insurance

This is a form of life insurance that you buy as a group. They are often used by companies to cover their employees. These plans include affordable premiums as companies are buying insurance in bulk and so they obtain discounts from insurers. It can also be useful in helping those with health issues obtain insurance. You should find out if the policy is portable so that if you change jobs, you can take the policy with you.

Photo Courtesy of Jacob Maslow//Cosmic Press