| By :
Marilyn Katz
Are you interested in buy life insurance? That is a great goal, but make sure you understand what you are buying. There are different kinds of coverage, and it is important to understand them before you decide to commit. Think about the difference between temporary and permanent protection. A term policy may last for decades, but it is still considered termporary. It the basic form, term policies expire at the end of the "term". The insured person will not have any coverage or value left in the policy. That is one reason that term is also cheaper. Having a finite goal, with an intended end, is a good reason to consider a term policy! It will give you the most pure coverage for your money. On the other hand, whole and universal life are considered permaenent policies. Your policy will cover as long as it is paid for or paid up. There is no expiration date. These types of permanent policies may also grow a value. So beyond pure insurance, they may actually grow an asset that can be used in other ways. If you are sure you want to be covered the same when you are 90 years old as you were when you are 39 years old, consider permanent polices. Of course, in general, a permanent policy will cost more. There are also some hybrid policies. Some of us have more complex needs. Besides, we know we cannot predict what will happen in twenty or thirty years. Is there a simple way to purchase a policy for your current use, but also to leave your options open? Some permanent policies will allow a term rider. While you need more coverage now, you can get it cheaper. This will give you permanent life insurance later too. You can also lock in rates at a younger age than if you just decide to buy whole life or universal life in the future. You can also find some term policies that will give you the option to convert to whole life before they have expired. The option should specify that you will not have to go through health underwriting again. That way, you can take advantage of a larger and cheaper term policy now. This means that if you do become unhealth, you can still be covered. Of course, those whole life rates may be higher just because you are older. So think about what you want out of your policy. If you have a goal, like paying off a mortgage or financing an education, a term policy is probably ideal. If you would also like to be sure you will have a policy to help you plan for retirement or a transfer of wealth, you may want to think about a whole life policy. Either way, be sure and compare policies and prices to make sure you get the best life insurance at an affordable price!
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