Life insurance can be either of following types
- Term life insurance: It provides coverage for a limited period of time and at the expiration of policy insured can either drop the policy or pay annually increasing premium to continue the coverage. There is no cash value with a typical term life policy and term insurance is often the most inexpensive way to purchase a substantial death benefit on a coverage amount per premium dollar basis.
- Whole life insurance: This on the other hand, combines a term policy with an investment components. The investment could be either in bonds, money market or stocks. Policy builds a cash value, against which you can borrow money later. Permanant life insurance coverage for as long as you live and continue to make premium payments.
- Univeral life insurance: Life insurance which combines the low-cost protection of term insurance with a savings component that is invested in a tax-deferred account, the cash value of which may be available for a loan to the policyholder. Universal life was created to provide more flexibility than whole life by allowing the holder to shift money between the insurance and savings components of the policy. Additionally, the inner workings of the investment process are openly displayed to the holder, whereas details of whole life investments tend to be quite scarce
- Variable universal life insurance: Name 'variable' here signifies the ability to invest the money in different form of investment vehicle. This life insurance policy along with insurance cover offers to build up the cash value. With a typical whole life policy, the death benefit is limited to the face amount specified in the policy, and at endowment age, the face amount is all that is paid out. Thus with either death or endowment, the insurance company keeps any cash value built up over the years. With a VUL policy, the death benefit is the face amount plus the build up of any cash value that occurs (beyond any amount being used to fund the current cost of insurance.)
Looking for an agent or a insurance company can be tricky and a time consuming process. Look for an insurance company which are stable and highly rated by A.M Best and Standard & Poor.
Top 10 Life Insurance Companies By Premiums (From the Insurance Information Institute):
Rank Revenue Assets
1 MetLife 53,150 $558,562
2 Prudential Financial 34,401 485,814
3 New York Life Insurance 29,280 179,621
4 TIAA-CREF 27,526 420,315
5 Mass Mutual Life Insurance 25,268 172,911
6 Northwestern Mutual 22,597 156,547
7 AFLAC 15,393 65,805
8 Genworth Financial 11,443 114,315
9 Principal Financial 10,907 154,520
10 Lincoln National 10,738 191,43
With the plethora of independent insurance agent, online agents etc looking for an agent can be trickier too, I've had a positive experience with select quote, If that helps they were prompt in service and not pushy with riders etc.
Here is the link to kiplinger article on how to get best rate on life insurance policy - Best Rate
2 comments:
Recently came across an article on Kiplinger on "how to get good rate on life insurance policy". It is a must read for any one shopping for a life insurance policy.
http://www.kiplinger.com/features/archives/2008/11/get_good_rate_on_life_insurance.html
There are lots of ways to save for retirement even though adults think of it as a boring task. Financial planning for retirement is an excellent way to secure a stable future and will give you a sense of freedom and independence from being a burden to others.
financial planning for retirement
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