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All life insurance policies can be categorized as “term”, “whole life”, or a combination of the two. This means there are many different variations in policies.

When you have opted for the universal life insurance, you can adjust the premium and the policy to any extend you think you need.

If you want control over the financial and investing aspects of your insurance policy, your best option would be a variable life insurance policy. This policy is similar to a universal policy in that it accrues cash value, but you can choose how this cash value is invested.

So let us find out what is A Term Life Insurance Policy?

The term life insurance policy provides insurance protection for a particular period of time. The term may be extended to 5, 10, or 20 years. When the term ends the policy also expires without any benefits and without any saved or accumulated cash value. But if you die during this term then the death benefit will be paid. The term insurance policy can be said as insurance that is actually designed to expire before you do.?

The premiums on term life policies start out low but can increase substantially as your age increases. This makes term life the best type of policy to purchase when you’re young and the term of the policy is long. Although the shorter term renewable policies would be less expensive in the beginning, the premiums start to increase significantly after middle age.

Below here is an illustrative example which shows the difference of term life insurance policy cost with age.

$300 / year age 35

$900 / year age 50

$2,500 / year age 65

Now we shall see what is a Whole Life Insurance Policy.

The most common type of insurance sold in the market today is the whole life insurance policy. A whole life insurance policy is valid till you die or until you reach the age of 100. But it must be taken care that you pay all the premiums as scheduled. Whole life insurance is otherwise known as the permanent insurance. Level premiums, level face amounts, guaranteed values, and a relatively high degree of safety compared to others are the main differential characteristics of a whole life insurance policy. The guaranteed cash value through the whole life insurance builds a huge benefit for the owner. This is very beneficial for the user, because this cash can be accessed during emergencies, and for other needs as well as a alternative source of retirement income.

This ability to access the cash accrued by a whole life policy makes it an important savings instrument. Whole life policies are often used for long-term financial planning. Another very positive aspect of whole life insurance is the level premiums: they don’t change, so you’ll always know how much your policy is going to cost. Level premiums provide peace of mind and make budgeting easier.

The risk factor in this policy is entirely different from the auto policy. In the auto policy the insurance company hopes that the driver will never encounter an accident and will be safe. But on the hand the when issuing a whole life insurance policy, the company is sure that the policy will be claimed one day.

Shopping for life insurance is now quite simple to do online. You can compare companies and policies to make sure you get the best premiums for the policy that meets your needs. It’s well worth the time to get several quotes, and to see how the companies are rated with the Better Business Bureau. It’s also important to look into the financial standings of the companies you’re considering before you sign up for any type of life insurance policy. If you do your research, you will easily get the best whole life insurance policy online.

Graham McKenzie is the content syndication coordinator a leading South African Life Insurance and Life Cover portal.

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