A life insurance policy states that you will pay premiums to an insurance company over time, and, in exchange, the company will pay a lump sum amount to a designated beneficiary upon your death. The money from your life insurance policy can help pay bills and help support your surviving family members' living expenses. You may need to adjust the amount of your life insurance policy related to major life events, like buying a home, getting married, or having a child.
There is no set amount of life insurance you need. If you have dependents you want to provide for or leave an inheritance to charities, you may need more life insurance than someone without dependents or charitable causes to support. Consider potential future expenses that your loved ones may need. The life insurance payout could be used to replace the money you would have earned to pay for their college education, moving expenses, or retirement. You can buy an individual life insurance policy from an insurance agent. You may also be part of a group life insurance policy through your employer or civic organization. If you are a veteran, you may be eligible for the VA's life insurance benefits.
Use these tips when you are shopping for insurance.
Types of Life Insurance
Đang chơi bàiThere are two main types of life insurance policies:
- Whole (or universal) life insurance policies are considered permanent. As long as you pay the premium, the policy is in effect. In addition to paying a benefit upon your death, whole life insurance policies also have an investment or savings component. This means that you accumulate cash value over the life of the policy, so you can borrow money from these types of policies if you need to.
- Term life insurance policies are in effect for a certain period of time or term. If you have this type of policy and pass away during the term that the policy is in effect, the insurance company will pay a benefit. If you live past the time that the policy is in effect, the insurance company won’t pay a benefit or give you a refund.
Term life insurance policies are usually less expensive than whole life insurance policies. This is because term life insurance policies only cover a set amount of time, while whole life insurance policies are intended to be permanent and because part of the money you pay is put away for savings.
Lost Life Insurance Policies
If you have misplaced a life insurance policy, your state's insurance commissionĐang chơi bài may be able to help you locate a copy of it. A policy locator service can search for it for a fee. If the insurance company knows that an insured person has died but can't locate the beneficiary, the company must turn the benefits over to the .