Term vs. Permanent Life Insurance
Did you know that August is National Life Insurance Awareness Month? What better time than now to talk to your agent about life insurance? Whether you just tied the knot, just had your first child, or simply just realized that it was time for life insurance, choosing the right policy can be difficult. You have to decide if you want term life insurance or permanent life insurance, then what the difference between that and permanent life insurance is. After that you have to decide which one is best for your family. Well, allow us to provide answers to some of your questions about life insurance.
What you need to know about Term life insurance:
- This may be the right choice for you if you need life insurance for a specific period of time. One of the popular examples is if you have children and want to ensure that there will be funds to pay for their college education.
- This is may also be the right option for you if you are looking for a large amount of life insurance, but have a limited budget. Why’s that? You do not build equity in the form of cash savings with this type of policy, and if you are still alive at the end of the coverage, you would need to renew otherwise the coverage stops.
In addition, there are “convertible” term policies which allow you to convert to permanent life insurance for a higher premium. It would not require a medical examination. The younger you are, the lower your premium will be. As you renew and get older, your premiums will increase.
What you need to know about permanent life insurance:
- When it comes to permanent life insurance, you have it for as long as you live(hence “permanent”).
- Permanent life insurance also allows you to accumulate a savings element that will grow on a tax-deferred basis and could be a source of borrowed funds for a variety of purposes.
- Permanent life insurance premiums for these policies are typically higher than term life insurance policies. However, your premium would not change, unlike term policies so when it comes to choosing the right price each of the options have their perks.
- There are numerous types of permanent life insurance policies such as universal life, variable life, variable/universal life and whole (ordinary) life.
If you are ready to choose a policy or need guidance in choosing which one is right for you, talk to one of our agents at Encharter Insurance. Our experts can provide you with answers to all of your questions, as well as shop around for the best prices. Connecticut Life Insurance is an important decision and should not be chosen spontaneously. Our agents are here to make the process a little easier for you!
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