Remember Me
forgot your password?

Life Insurance Types Explained - See Which Policy Fits Your Needs

Deciding which life insurance types to look at depends on each individuals specific need. All life insurance does not fit everyone's situation. Let us examine why a single person would buy life insurance. What about a single parent, what kind of policy would fit this person? Sometimes we tend to think only married people buy life coverage. Why would we think this way? How about business people? Why should these people consider life policies?

Married People

Let us look at the needs of married people as this seems to be the main reason people buy life insurance. Let us also examine the life insurance types they tend to be interested in.

You meet your soul mate and you decide to get married. You also have plans to have one or two children. Your partner and yourself work at jobs that yield a good income. You both decide it would be wise to buy a home before you have children. As you proceed with that you become very aware that you need some life insurance in case one of you should die. You want the home to be left free and clear.

The life insurance types that you look at are level term policies and decreasing term insurance. With the level term policy the death benefit remains the same throughout the life of the policy. With decreasing term the face amount of the policy decreases as the balance of the mortgage decreases. You settle on the decreasing term policy as the premiums are cheaper.

You also become aware that as you plan on having children you will have a need for more life insurance. You can buy it now as it costs less or you can buy more and more as the years go by, if you can qualify for it. You decide to buy a term life insurance policy sufficient to maintain the family at least until the youngest child graduates college. You feel a 20 year term policy would solve that problem.

You are also aware that your spouse may need to guarantee your income up until age 65, retirement age. One of the life insurance types you look at is probably a 30 year term policy or possibly term to age 65. In some cases a universal life policy or a whole life policy would fit the bill.

Single Parent

The needs of a single parent are similar in many ways to those of married people. These people have an even more urgent need as if this parent should die there will be no other parent to care for the children. After taking the time to make the necessary arrangements for there care a single parent now has to look at life insurance types that would best fit their particular situation.

As this person has a need to be careful with money level term policies would more likely fit like a glove. If the children are young the 20 year, 25 year or 30 year policies, in the right amount, should be sufficient to carry them through from infancy to the end of their college years. If they are older you may want to use a 10 year or 15 year term policy.

Single Person

Does a single person need life insurance? Why? The only real life coverage need a single person has is one that will provide sufficient cash to pay off outstanding debt, if any, and to pay funeral costs. It would probably a good idea to use a 10 year term to do these things. These people should keep in mind though that coverage is much cheaper to purchase at a young age. It would be wise to buy a fairly larger amount of the type of policy that would be useful when they get older, that is if this person plans on marrying and having children sometime in the not too distant future.

The types of life coverage types to consider here would be 20 year term or 30 year term policies.

Business People

Life insurance is an important consideration for any type of business. A corporation or partnership would need life insurance on the lives of each shareholder or partner which the survivors would use to buy out the shares of a deceased shareholder. Which life insurance types do these executives look at? Level term policies are usually used to fund this initially but they are usually converted to permanent policies later on that is if they intend to keep the business going for a long time.

Key man or key employee life insurance is very popular with most any business. You buy a policy on that employee whose absence may hurt the company. You make certain that if this employee dies suddenly you have sufficient funds to tide you over until a suitable replacement is found. Long term level term insurance policies can be used for this. Permanent insurance is sometimes used. This could provide a lump sum or additional income for this employee at the time of his or her retirement.

Donald Lusan

Here are some of the major life insurance types

For more than 40 years Donald has been known for his extensive knowledge of the life insurance business. He has represented some of the largest and most admired life insurance companies in the United States as well as Canada. His advice is invaluable.

Donald's website is: Life Insurance Hub

Also see: Life Insurance Answers

Rate this Article: 0 / 5 stars - 0 vote(s)
Print Email Re-Publish

Add new Comment



Captcha

  • Latest Insurance Articles
  • More from Donald Lusan

Aetna Family Health Insurance Offers Great Option For All Types of Groups

By: Rick Lewis | 24/11/2009
There are many questions concerning health care that are coming out now as the epidemic of health insurance sweeps the United States. It has been found recently that 1 in 4 Americans

Highmark Health Insurance Products Ranked Among 'America's Best Health Insurance Plans

By: Rick Lewis | 24/11/2009
Two of Highmark Inc.'s health insurance products are among "America's Best Health Insurance Plans 2009-10," according to U.S. News & World Report/National Committee

Blue Cross of Northeastern Pennsylvania Improves Customer Relationship Health

By: Rick Lewis | 24/11/2009
The health insurer enabled callback tools in its contact center to improve customer satisfaction.

Government option already a failure

By: Rick Lewis | 24/11/2009
As the Senate weighs a 2,074-page healthcare "reform" bill, supporters of a government option for medical coverage consider this the finest federal initiative

Pilot project may revolutionize how health care is managed

By: Rick Lewis | 24/11/2009
A pilot program is helping 13 area doctors’ offices convert to doing that for their patients.

UniCare to stop providing health insurance in Texas

By: Rick Lewis | 24/11/2009
Its more than 180,000 customers will have option to switch to Blue Cross/Blue Shield.

UniCare to stop providing health insurance in Texas

By: Rick Lewis | 24/11/2009
Its more than 180,000 customers will have option to switch to Blue Cross/Blue Shield.

UniCare to stop providing health insurance in Texas

By: Rick Lewis | 24/11/2009
Its more than 180,000 customers will have option to switch to Blue Cross/Blue Shield.

Universal Life Insurance Explained

By: Donald Lusan | 17/11/2009 | Insurance
Consider universal life insurance. One of the more popular permanent policies is the universal life policy. What is this universal life all about anyway? This policy is permanent insurance which allows for flexibility in premium payments as well as in death benefit amounts. Think of this policy as a savings account with a life insurance policy attached.

Term And Whole And Universal, Graded Premium And Variable life insurance

By: Donald Lusan | 01/11/2009 | Insurance
Term and whole and universal life insurance are the the types of policies you are most likely to encounter when you set out to get quotes or, in general, examine life insurance policies. There are, however other types that not many people know much about.

Term Life Insurance With No Medical, No Physical, No Doctor Exam

By: Donald Lusan | 25/10/2009 | Insurance
More and more people are buying term life insurance with no medical, no physical or no exam by a doctor, paramedic or nurse. The convenience of actually printing out your policy there and then seems to appeal to buyers a great deal. The surprising thing is how low the premiums are.

Buying Life Insurance For Family Protection Or Business Protection

By: Donald Lusan | 19/10/2009 | Insurance
Buying life insurance is so very important. It is an integral fundamental in any sound financial plan. The type and amount of coverage you select will depend on why you need to buy your policy.

Life Insurance Types Explained - See Which Policy Fits Your Needs

By: Donald Lusan | 05/09/2009 | Insurance
Deciding which life insurance types to look at depends on each individuals specific need. All life insurance does not fit everyone's situation. Let us examine why a single person would buy life insurance.

Term Life Insurance - Term Life Quotes, Rates, Companies, Policies, Definition, Comparisons

By: Donald Lusan | 30/08/2009 | Insurance
Term life insurance is favored by a large portion of our population. Let us take a close look at this policy and see why. It may be wise to begin by attempting to define this type of policy. Let us see what it is all about.

Life Insurance With No Physical, No Medical, No Exam, No Health Check

By: Donald Lusan | 25/08/2009 | Insurance
Looking for life insurance with no physical required? Some people choose non medical life insurance because they simply don't have the time or the inclination to go through the rigors of a full medical examination. Others make this decision simply because they don't like to go to the doctor.

A Life Insurance Policy - What Is A Life Insurance Policy Really?

By: Donald Lusan | 20/08/2009 | Insurance
What in fact is a life insurance policy? What is all the hoopla really about? One writer put it this way. "A life insurance policy is just a drop of ink on a piece of paper." There is nothing very significant about that. The important thing to focus on is what this kind of policy does. What does it do for the person who buys this paper with drops of ink all over it? Of course the value of it all depends on what is written on this piece of paper.

Submit Your Articles Free: Signup
Article Categories




Use of this web site constitutes acceptance of the Terms Of Use and Privacy Policy | User published content is licensed under a Creative Commons License.
Copyright © 2005-2008 Free Articles by ArticlesBase.com, All rights reserved. (2.83, 4, w1)