Life Insurance No Physical-Think Twice

You have probably seen advertisements in newspapers and magazines for life insurance requiring no physical examination, as a condition for getting insured. These policies are also known as “guaranteed issue” or “simplified issue” policies, with simplified issue insurance requiring that you just answer a few medical questions. On the surface of it, it seems like “no exam” is the type of life insurance that anyone would prefer. Why would I want to go to the trouble of getting a physical examination when so many companies seem very eager to sell me term life insurance no physical? Continue reading “Life Insurance No Physical-Think Twice”

Difference Between Term And Whole Life Insurance

If you’re not clear on the precise difference between term and whole life insurance, you have come to the right guide on insurance. I promise: by the end of this short article you will be clear.

There a few major differences, so let’s take them one at a time. Term life is insurance that you buy for a limited, defined term. This term could be as little as a year, but it’s usually between 10 and 30 years. Whole life, on the other hand is good for the whole of your life, i.e. until you pass away, or until you reach a very old age as specified in your policy, say 90 or 100 years old. So, the #1 difference between term life insurance and whole life insurance is whether there is a fixed length or term of the policy, or there is not.

The implied rule here is that you know for certain that with a whole life policy you will receive a death benefit payout, as long as you make your premium payments, unless you yourself decide to terminate the policy early, for some reason. With term life you know for sure that you will not get a payout unless you die within the term of the policy. It’s very simple, and note that it’s hardly a question of whether one type or another is ‘good life insurance’: the best policy is the one that make the most sense for you.

The next difference between whole life and term insurance? Let’s look at their investment function, or lack thereof. Term policies have no investment value. You cannot borrow against them and the payout amount is fixed from the start. With whole life, as well as other forms of permanent insurance, you can borrow against the cash value amount that has built up, at an interest rate that is probably going to be lower than credit cards and other loan sources. Now, most unbiased insurance experts at least (i.e. experts not actually engaged in trying to sell you whole life insurance!) will tell you that while whole life might be good life insurance in a generic sense it is not a great investment, but that is the subject of another post.

We just touched on the basis for a big difference between term life and whole life insurance, that of the concept of ‘cash value’. This amount builds up over time, based on interest earned by the premiums that you pay. The idea is that the cash value amount will cover the guaranteed payout that the insurance company is obliged to pay when you die. You may borrow against this amount, but be careful that you don’t overdo it as you may impact the eventual policy payout, which is the reason for buying life insurance in the first place! Also, since borrowing against the cash value is a little like paying the insurance company to borrow from yourself don’t put too much weight on this feature as a reason to buy whole life insurance. Oh yeah: term life does not have this cash value feature. Your death benefit, should your beneficiaries get it, is all that you are owed. It’s a fundamental tenet of the basics of life insurance.

Here’s a big one– the premium amounts that you pay, for a similar payout amount. As any term life insurance guide will tell you, the difference is huge. Whole life premiums are multiples of what term premiums are for the same coverage amounts. Now, although anyone would be attracted to the idea that his heirs will definitely get a payout upon his death, the high cost of whole life premiums is enough to make a smart a smart buyer think twice, and this leads us to the final, essential point:

Most people don’t buy whole life insurance. They buy term. Good life insurance for them primarily means lower payments and a clearly defined policy.

OK, whole life wouldn’t exist as a product unless it was a good idea for some. But rather than paying the sky-high whole life premiums, most folks opt for a term policy (maybe with an option to renew after the initial term finishes) and try to diligently invest money that they might have paid toward a whole life policy. In this way they will very probably have a larger nest egg when they pass away than the promised whole life payout that their sizable premiums are going toward each month. This is the most critical difference between term life insurance and whole life, and while it’s always best to get a second and third opinion on life insurance basics as you augment your knowledge with a good whole and term life insurance guide, it’s why you’ll most likely end up buying term life.

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Mortgage Insurance Quote Tips

A mortgage insurance quote is something you should seriously consider obtaining if you are a homeowner and would like to protect yourself and your family from dire financial straits should you as the primary wage earner become incapacitated or if you pass away. In this article I will attempt to cover a few of the pros and cons of Continue reading “Mortgage Insurance Quote Tips”

Life Insurance Advice

It’s easy to ask around for advice on life insurance, just like it’s easy to find people with opinions on how to successfully make money in the stock market. Asking questions and getting educated is always a good thing, but the problem is that getting life insurance advice from nonprofessionals may very well result in conflicting advice and confusion on your part. You need to Continue reading “Life Insurance Advice”

Whole Term Life Insurance Ideas

When you choose a life insurance policy, you have to pick from term or whole life insurance (or another form of permanent life insurance). Term life insurance is cost-effective and will give benefits to your family if you die but if you fail to die (so to speak), nobody gets anything (except the life insurance company). Whole life insurance will provide coverage for all your life and you can either cash in or borrow against it in case you live through the life of the policy. You get the payout amount or even more because Continue reading “Whole Term Life Insurance Ideas”

Insurance Settlement Basics

A life insurance settlement can be defined in a few different ways, but normally it is simply the sum of money that one’s heirs receive after a policyholder passes away. After you responsibly pay your monthly premiums and/or maintain the cash value amount associated with your life insurance policy, your loved ones are entitled to this so-called death benefit payout, or insurance settlement. Whether these funds are used to pay off your Continue reading “Insurance Settlement Basics”

Guaranteed Acceptance Life Insurance

At first glance, guaranteed acceptance life insurance probably sounds like the easiest way to get life insurance, but the fact is it might be a much better deal for the insurance company than it is for you.

Have you ever wondered why there are so many advertisements for life insurance of the type that promise to guarantee you a policy? Where are the ads encouraging you to get life insurance that would require that you take a medical exam as a condition of being granted a policy? Is it possible that Continue reading “Guaranteed Acceptance Life Insurance”

Low-Cost Term Life Insurance Tips

It is almost redundant to talk about low cost term life insurance, as it is so much cheaper than the alternative, permanent life insurance. Since the latter promises a guaranteed payout, is naturally much more expensive than term life. In fact term insurance isn’t say, half as expensive as permanent life, your term premium payments will actually be Continue reading “Low-Cost Term Life Insurance Tips”

What To Look For In A Life Insurance Quote

Are you looking to buy life insurance or renew the coverage you have?  In this article I’m going to give you all the tips and information you will need to get a good life insurance quote.

What Are The Fees

With life insurance the fees can vary greatly from one policy to the next.  For example when looking at a term life vs whole life insurance policies, term policies will hold the same cost of insurance through out the entire period of the policy but when you go to renew the policy the cost will usually increase depending your age and health.
Continue reading “What To Look For In A Life Insurance Quote”

Instant Whole Life Insurance Quote

The Internet has really simplified the process of getting life insurance, and whole life insurance quotes are readily obtainable with a quick search. Let’s start with a definition of whole life, and then move onto a caveat that you have to keep in mind when you are tempted to buy based on an instant life insurance quote of any kind. Continue reading “Instant Whole Life Insurance Quote”