It's important to know that in the event of one's death, his or her family will be taken care of financially. Life insurance policies which provide coverage for funeral expenses and secure their dependents with an ongoing benefit to cover living expenses. Not every policy is the same however, so when shopping for life insurance Chicago customers need to carefully choose the one which best matches their needs.
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.
The four main types of life policies are term, whole, universal, and variable. Term coverage has a specified period within which the recipients will receive benefits if the insured dies. Upon expiration, it can be renewed, but usually for a higher premium because the policy-holder will be older. This is the most popular type of policy, because it has a choice of terms, is tax-free, and provides good coverage for the price paid.
Whole life policies do not have an expiration and also provide the insured with a hedge fund besides death benefits. Premiums are typically higher, as are the agent's commissions, but part of the amount paid is deposited into an account that will collect interest and can eventually be withdrawn, at which point it will become taxable. This is ideal as a permanent option or for many years, since forfeiting it early can result in a loss.
Universal policies involve the premium being placed into an investment fund which covers both the administrative costs and death benefits. The monies in this fund gain interest according to the current market trends, which can either increase or decrease its total value. The insured has a considerable degree of flexibility in terms of how much and how often premiums are paid, but there is some risk involved.
Variable life insurance policies are those which involve investing one's money into a choice of assets such as stocks and bonds. The amount of one's tax-free death benefit depends on how well these chosen investments perform over time, which can be risky or very profitable. If one chooses to surrender the policy, they will receive the taxable cash value, however no minimum is guaranteed and it may become zero.
Although there are several avenues one can take for purchasing life coverage, most people prefer to do so through a reliable agent who represents a company with a strong reputation. A professional agent must possess a state license to sell insurance, and he or she should always be happy to answer the customer's question, never pressure them into anything, and will clearly explain how the policy works to them.
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.
The four main types of life policies are term, whole, universal, and variable. Term coverage has a specified period within which the recipients will receive benefits if the insured dies. Upon expiration, it can be renewed, but usually for a higher premium because the policy-holder will be older. This is the most popular type of policy, because it has a choice of terms, is tax-free, and provides good coverage for the price paid.
Whole life policies do not have an expiration and also provide the insured with a hedge fund besides death benefits. Premiums are typically higher, as are the agent's commissions, but part of the amount paid is deposited into an account that will collect interest and can eventually be withdrawn, at which point it will become taxable. This is ideal as a permanent option or for many years, since forfeiting it early can result in a loss.
Universal policies involve the premium being placed into an investment fund which covers both the administrative costs and death benefits. The monies in this fund gain interest according to the current market trends, which can either increase or decrease its total value. The insured has a considerable degree of flexibility in terms of how much and how often premiums are paid, but there is some risk involved.
Variable life insurance policies are those which involve investing one's money into a choice of assets such as stocks and bonds. The amount of one's tax-free death benefit depends on how well these chosen investments perform over time, which can be risky or very profitable. If one chooses to surrender the policy, they will receive the taxable cash value, however no minimum is guaranteed and it may become zero.
Although there are several avenues one can take for purchasing life coverage, most people prefer to do so through a reliable agent who represents a company with a strong reputation. A professional agent must possess a state license to sell insurance, and he or she should always be happy to answer the customer's question, never pressure them into anything, and will clearly explain how the policy works to them.
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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