There are plenty of questions to ask when you are ready to buy insurance. Life life term versus whole can be confusing, so find an agent who is knowledgeable about all types of insurance and get all your questions answered to your satisfaction.
You will need someone knowledgeable to walk you through all the different types of policies available to you. There are term, permanent, universal and variable universal.
Term life insurance is the easiest to understand and the least expensive. A term life insurance policy pays out a death benefit when you die but does not hold any cash value.
A term life policy is basically available for set periods of time, like 10, 15, 25, or 30 years. Of course then there is annual renewal term life where your policy automatically renews each year. This is great except that your premium increases each year also.
There is level term insurance you can buy if you want your premium to be the same for the entire length of the policy.
Last but not least there is decreasing term insurance in which your death benefit declines over the length of the policy but you premiums remain the same. A decreasing death benefit is chosen if you need to cover one specific debt that also decreases like your mortgage.
Talk to your insurance agent and get them to go over all the specifics with you as I have only touched on the basics here. You and your agent will need to tailor your insurance life life term versus whole policy to fit your needs.
Whole life insurance is now available in several forms such as, permanent, universal, and variable universal. All have different components or considerations to them and you will need to sit down and talk to your agent to get a good understanding of all the aspects of each kind before you buy your policy.
You may be able to add riders to your policy such as an accelerated death benefit which pays the death benefit early if you should become terminally ill. Accidental death benefit which pays extra if you die as a result of an accident. Long term care benefit which pays for you to enter a nursing home for care should you become incapacitated and be unable to take care of yourself. And Waiver of premium benefit which waives your premium payment should you become totally disabled for any reason.
The cost of each of the policies outlined above are different and are based on the types of coverage you choose and your medical history. You will be required to get a physical examination which may include giving blood and urine samples before you are eligible for your policy. Based on you medical history and results of your physical you will be categorized as “preferred plus”, “preferred”, “standard”, or “substandard”. The category your are put in determines what your premiums will be.
Be prepared for a lot of paper work when filling out the application. Processing your insurance life, life term versus whole application can take up to 30-45 days so patience is in order.