djamal-soft
الاثنين، 11 أغسطس 2014
The purpose of a life insurance policy is to financially protect the dependents of a person when he or she dies. An ongoing benefit will be paid to any named dependents upon the policy-holder's death to cover their living expenses and the funeral costs of the deceased. Different types of policies are available to suit the needs of every customer, when it comes to buying life insurance Chicago consumers should be aware of these main guidelines.
Benefits packages provided by many employers often include some life coverage, although the insured generally has little control over the amount of benefits and other details of these policies, and if the employment ends, so does the insurance. One must still take this into account when determining how much and which type of plan to purchase.
There are four basic types of life policies; term, whole, universal, and variable. A term policy has a specific coverage period and only pays if the policy-holder dies within that time frame. It can be renewed and offers the best overall coverage for the price paid. The benefits are tax-free, and a choice of term periods is usually available, however the premium upon renewal will typically increase along with the age of the insured.
A whole life insurance policy generally attracts a higher premium, and commissions paid to one's agent. It has no expiry and instead of providing a death benefit alone, it also builds a savings fund that will gradually accumulate interest and is only taxable when withdrawn. This is a good option for those who plan on keeping it permanently or for a long time, otherwise they may end up losing money.
A universal policy gives the insured a fair amount of flexibility in terms of how much benefits are paid, and the amount and frequency of the premiums. The money is paid into an investment fund from which administrative costs and the death benefits are taken. This fund is subject to gaining interest according to current market rates, which can have either a positive or negative effect on its value.
A variable life insurance policy invests the premium into assets such as stocks or bonds of the policy-holder's choosing. The performance of these investments during the length of the policy will ultimately determine which amount of death benefits are available to the beneficiaries of the insured. It is also possible to cash it in for the taxable cash value, but there is no guaranteed minimum, and it can drop to zero.
There are different ways a customer can purchase insurance, although the safest bet is to deal with an agent who represents an insurance company with a solid foundation. Besides being licensed in one's state, a good agent will answer any questions his or her clients may have, won't pressure them into making a decision, and will ensure that they understand exactly what they are getting for their money.
Applicants will need to fill out a questionnaire and may be required to get a physical as well. They must be truthful in their answers and disclose all relevant information pertaining to their health. The company will review the application and decide if they will offer coverage to the applicant, and if yes, what premium amount will be paid.
Benefits packages provided by many employers often include some life coverage, although the insured generally has little control over the amount of benefits and other details of these policies, and if the employment ends, so does the insurance. One must still take this into account when determining how much and which type of plan to purchase.
There are four basic types of life policies; term, whole, universal, and variable. A term policy has a specific coverage period and only pays if the policy-holder dies within that time frame. It can be renewed and offers the best overall coverage for the price paid. The benefits are tax-free, and a choice of term periods is usually available, however the premium upon renewal will typically increase along with the age of the insured.
A whole life insurance policy generally attracts a higher premium, and commissions paid to one's agent. It has no expiry and instead of providing a death benefit alone, it also builds a savings fund that will gradually accumulate interest and is only taxable when withdrawn. This is a good option for those who plan on keeping it permanently or for a long time, otherwise they may end up losing money.
A universal policy gives the insured a fair amount of flexibility in terms of how much benefits are paid, and the amount and frequency of the premiums. The money is paid into an investment fund from which administrative costs and the death benefits are taken. This fund is subject to gaining interest according to current market rates, which can have either a positive or negative effect on its value.
A variable life insurance policy invests the premium into assets such as stocks or bonds of the policy-holder's choosing. The performance of these investments during the length of the policy will ultimately determine which amount of death benefits are available to the beneficiaries of the insured. It is also possible to cash it in for the taxable cash value, but there is no guaranteed minimum, and it can drop to zero.
There are different ways a customer can purchase insurance, although the safest bet is to deal with an agent who represents an insurance company with a solid foundation. Besides being licensed in one's state, a good agent will answer any questions his or her clients may have, won't pressure them into making a decision, and will ensure that they understand exactly what they are getting for their money.
Applicants will need to fill out a questionnaire and may be required to get a physical as well. They must be truthful in their answers and disclose all relevant information pertaining to their health. The company will review the application and decide if they will offer coverage to the applicant, and if yes, what premium amount will be paid.
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