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The Basics of Whole Life Insurance

By Compuquotes Team on April 27th, 2008

If you're concerned about making sure that your family will not have to face dire financial consequences if something should happen to you, purchasing a whole life policy is one of the best investments you can make. Whole life insurance is often referred to as permanent insurance. With this type of insurance, as long as you pay your premiums, you're coverage will remain in effect throughout your lifetime unless you choose to surrender the policy.

When Should I Purchase Whole Life Insurance?

The best time to purchase a whole life insurance policy is right now. Age has a major impact on the cost of whole life insurance. The older you are when you purchase a policy, the more expensive the premium is likely to be. With whole life policies, premiums generally remain the same throughout the entire term of the policy payment period. Purchasing your whole life coverage while you're young can save you a significant amount of money during your lifetime.

Many people put off purchasing a whole life policy, only to find that they are uninsurable by the time they are ready to act. Individuals with serious medical conditions find it difficult or impossible to get the life insurance coverage they need. The longer you wait to purchase a whole life insurance policy, the more likely it is that you might develop a medical condition that could keep you from being eligible for life insurance. If you want to protect your family, make sure that procrastination doesn't keep you from being able to enjoy the peace of mind of having a whole life policy in place.

Why is Whole Life the Best Option?

When you purchase a whole life policy, coverage is guaranteed for the rest of your life as long as you pay your premiums per the terms of your agreement. This is why whole life coverage is referred to as permanent coverage. Once the policy is in place, assuming you honor the terms of the agreement, you can be confident that your family will be receive a set sum of money in the event of your death. This feature is unique to whole life coverage.

Additionally, whole life policies include guaranteed cash value amounts. Other types of life insurance policies pay out only in the event of the death of the insured individual, with funds going to the designated beneficiaries. With whole life coverage, you can choose to surrender the policy in exchange for cash, per the terms of the particular policy you purchased. You can also use these types of policies as collateral for loans, which allows you to keep the death benefits in place while using the policy as leverage to improve your cash flow.

Choosing Whole Life Insurance

When you start shopping for insurance, it won't take long for you to discover that whole life coverage is not the cheapest available option. However, it's important to consider what you are getting for your investment. If your goal is to make sure that your family will always be protected from financial strain if something happens to you, investing in a whole live policy is the best option for insurance coverage.

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