Life insurance exists in two forms, term, and permanent life insurance. When shopping for coverage, you might find that, while term policies may be sufficient for most individuals, the scope set forth by permanent life insurance is well worth consideration. For example, if you’d prefer a payout regardless of the time of death, a cash value component, and coverage for respite care, permanent life insurance could be for you.
There are many types of permanent life insurance to choose from, which depend highly on payment flexibility and the level of risk you’re comfortable carrying. Wholly life insurance, for example, is a permanent indemnity policy featuring a slowly accumulative cash value component alongside fixed premiums. Policyholders can borrow against cash value with a death benefit deduction should they fail to pay it back. They offer many ways to pay premiums, including a fixed number of years and single-payment policy options.
A universal joint life sentence policy allows policyholders to adjust the death benefit and premiums. This type of permanent life insurance provides flexibility in times of unforeseen changes in fiscal circumstances. You can also combine the death benefit with the cash value to increase the beneficiary payout. Universal life is a specific type of universal life insurance tied to a stock index (including the Dow Jones, S&P 500, and more).
Policyholders seeking an opportunity to invest their cash prize through an insurance company may prefer a variable life insurance policy. Report earnings can go toward fixed premiums or add to a death benefit. Otherwise, the death benefit may decrease if your investments fail with less money toward premiums. However, insurance companies typically provide a guaranteed minimum death profit, ensuring your heirs receive a cash benefit in your passing.
The overall cost of permanent life insurance varies significantly depending on your chosen policy. If you struggle to determine whether life insurance is the right choice, you must consider factors such as flexibility, longevity, and cost. This insurance product is an excellent fit if you need coverage regardless of when you die, want a cash prize investment component, or hope to leave money to heirs through a life sentence insurance option.