ANSWERS: 1
  • Life insurance pays a defined benefit amount when the policyholder dies. Term life insurance pays if the death occurs during the term of the policy--a predetermined number of years. Whole life insurance pays whenever the policyholder dies, no matter what age.

    Term Life Insurance

    The simplest and most inexpensive form of life insurance is a term policy. The benefit amount, term time limit and your age at the start of the policy determine the premium amount you will pay.

    Whole Life Insurance

    Payments for a whole life policy are the same amount for the life of the policy, so the policyholder is paying more than necessary in the early years.

    Whole Life Insurance as an Investment

    The amount paid on a whole life policy accumulates a cash value that the policyholder can access during the life of the policy.

    Permanent Life Insurance

    Whole life insurance is also known as permanent insurance.

    Taxes on Life Insurance

    Your beneficiary will not pay any taxes on the benefit amount she receives as a payout from your insurance policy.

    Source:

    Principal types of life insurance

    What You Should Know About Buying Life Insurance

    66 Ways to Save Money

    More Information:

    Life and Health Insurance Foundation for Education

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