Congratulations!
You have arrived at the premier site for insurance quotes. Here
at www.1stinsurancequotes.com you will find a resource guide that
makes it easy to shop for the best rate on nearly any type of
life insurance you need.
Confused about which
type of life policy to choose? This handy click and read online,
resource guide will also help you understand different types of
policies. After all, it's your life, your assets, your family
you are protecting. It's just too important for guessing.
Insurance companies
offer variations on many kinds of life products with accompanying
rates that sometimes make it difficult to understand what your
are getting. You want the lowest price you can find, but you also
want to remember that "cheap" does not always mean "top quality."
How will you know?
Begin by using our site to find the best prices AND to gain an
understanding of the way different types of life coverage work.
Quick definitions of the
major types of Life Insurance
People often think
of
as just enough coverage to pay for final expenses. Even if you
have severe health problems, you can purchase enough life insurance
to pay for a funeral. One choice is called "preneeds"
insurance and is purchased directly through the funeral home with
the funeral director as the beneficiary. This locks in the price
of your funeral. The other choice is a "Graded Benefit Life"
insurance. These policies usually have small face values—around
15,000 the average max—and must be in force for two years
before paying the entire face value. If you die in the first two
years, your beneficiary receives the premium plus interest. The
most important point about Graded Benefit Life is that an applicant
is seldom ever turned down.
is the simplest, most worry free type of policy. You
pay set premium rates for your whole life, although you can pay
more and have it paid off in 10 to 15 years. During your life
time, the policy builds cash value which you would get if you
ever decided you didn't need the policy and wanted to "cash surrender"
it. If you keep the policy for your entire life, your beneficiary
will get the face amount when you die. If you live to age 100,
you will receive a check for the face amount of the policy.
is nearly the opposite of whole life and is also
the cheapest. You can get very large face amounts for a very low
cost that will cover you for a certain time period, usually 20
years. The company does not actually intend for you to renew the
insurance at the end of the period, but you will have the option
to do so if you are willing to pay an increased premium every
year. The premium will go up steeply. You may have an option to
keep the premium the same, but have your face value drop every
year. Some of your better companies also offer you the opportunity
to convert a to one or more of their available permanent insurances
during the first few years of the policy.
is a combination of the best of whole life and the best
of term. The premium is usually inexpensive compared to whole
life, but higher than Term. The policy has two parts—the
life insurance portion, and a savings or cash accumulation portion.
Each month, you pay into the savings portion and the company adds
interest. This creates a "pot of money." The company pays your
cost of insurance (COI) and fees out of this pot. If you pay 10%
to 20% more than what is actually needed to pay the COI, you are
likely to have a savings that will keep growing and will stay
ahead of the COI. If you pay only the minimum required, the savings
will stay ahead of the COI for only a few years, and the policy
will terminate—just like term coverage. The advantage of
a universal policy is that it is completely flexible. You can
adjust your payment, your face value, the time and frequency of
payments, and can even skip payments and withdraw cash. You must,
however, be aware that the interest the company is paying on your
premium is also flexible and may change with the economy.
is difficult to find and is not as popular as it was
before the development of Universal policies. Variable is the
most expensive type of permanent, cash value life insurance you
can buy because it allows you to allocate a portion of your premium
to the company portfolio which is then invested in stocks, bonds,
mutual funds, money market accounts, or other investments. The
advantage to this type of policy is that in a period of economic
growth, your cash portion can increase rapidly. You can use some
of your interest accumulation to pay for your insurance, thereby
lowering the cost of your insurance. It is important, however,
to have a broker who monitors your account faithfully or to understand
the markets yourself. If the economy makes a down turn, you want
to move your money quickly into money market to prevent a loss.
Because these types of policies are dependent on the stock market,
the face value of your life insurence can also drop, although
not below a pre-determined contract level. Unlike Universal, you
cannot take money out of these policies prior to your death.
like universal, has a savings and a life insurance
portion. Also, like universal, you can add extra cash, vary your
premium, and take out cash if you need it. The variable part is
the cash accumulation. The interest paid is based on the growth
of the S & P 500. You may be able to participate in 65% or
more, depending on the company. That means, if the average growth
of the S & P over the course of one year from the issue date
of your policy is 10%, you will have a 6.5% increase for the year.
The interest paid can—and will—go up or down each
year, but will never drop below a guaranteed minimum interest
rate. Also note that smoker rates will be a bit higher. (see also
)
is a type of joint policy which covers two or more
people and pays the beneficiary when the second or last insured
dies. It is also called "survivor" or "second to die."
The inverse of this policy is Joint or First to die which also
covers two or more people, but pays the beneficiary whenever the
first insured dies.
