Different Types Of Life Insurance Policies You Need To Know About
Life insurance policies are essential tools for financial planning, offering protection for families and peace of mind. Craig & Preston Insurance Agency provides life insurance in Charlotte, Matthews, NC, Concord, NC, Fort Mill, Gastonia and surrounding areas.
These are the main types of life insurance policies you should know about:
- Term Life Insurance
Term life insurance provides coverage for a specified period, such as 10, 20, or 30 years. If the policyholder dies within this term, beneficiaries receive a death benefit. It’s generally more affordable than other types and is ideal for people who need coverage for a specific timeframe, like until children reach adulthood or a mortgage is paid off. However, there’s no payout if the policyholder outlives the term.
- Whole Life Insurance
Whole life insurance offers lifelong coverage and includes a savings component, which builds cash value over time. Premiums are typically higher, but the cash value can be borrowed against or withdrawn. This type of insurance is ideal for those who want both a guaranteed death benefit and a way to accumulate savings.
- Universal Life Insurance
Universal life insurance is a flexible type of permanent coverage. It includes a cash value component that earns interest and offers adjustable premiums and death benefits. This policy is suited for people who want lifelong coverage with the flexibility to adapt their policy as their financial needs change.
- Variable Life Insurance
Variable life insurance provides permanent coverage with a cash value that can be invested in various sub-accounts, similar to mutual funds. The death benefit and cash value fluctuate based on investment performance, making it riskier but with potential for higher returns. It’s best suited for individuals comfortable with investment risk.
- Final Expense Insurance
Also known as burial insurance, final expense insurance is a small whole life policy that covers funeral and end-of-life expenses. It’s ideal for those who want to relieve their families of financial burdens after their passing.
Understanding these different types of life insurance policies can help you choose one that aligns with your needs, lifestyle, and financial goals.
If you need assistance, we’re just a phone call away.
