Life Insurance in Pictures
Pictures say a 1000 words. Having said that, below are explained different Life Insurance types like Term Life Insurance, Whole Life Insurance, Variable Life Insurance, Universal Life Insurance, Variable Universal Life Insurance.
Each picture is self explanatory, on how is the process. You can read the text below the image and understand. This is just for your understanding, and if needed more information please consult your Life Insurance agent.
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To start with, let us understand Term Life Insurance:
Term Life Insurance is pure insurance. When you purchase a term policy, you are buying coverage for a specified period of time. If you die within the specified period, the insurance company will pay your beneficiaries the face value of your policy.
Next is Variable Life Insurance.
Variable life insurance is cash-value life insurance with values reflecting the performance of a variety of funds that you select. It differs from traditional permanent life insurance.
Most important is Whole Life.
When you purchase a whole life policy, you traditionally pay a fixed premium for as long as you live or for as long as you keep the policy in force. Part of your premium goes to the insurance company for the pure protection element of your policy.
Next in our series of Life Insurance in Pictures is Universal Life Insurance.
Unlike traditional whole life insurance policies, universal life policies are very flexible. If your policy has sufficient cash value, you may vary the frequency and amount of the premium as you see fit (subject to policy provisions). You may also increase or decrease the face amount of your policy to suit changes in your situation (subject to underwriting).
Last but not the least, Variable Universal Life Insurance
Variable universal life insurance policies operate much the same as “traditional” universal life policies. IN exchange for a periodic premium, the insurance company provides a specific death benefit. The policies accumulate cash value on a tax-deferred basis. And like traditional universal life policies, variable universal like policies offer the flexibility to change either your premiums or death benefit to suit changes in your situation (subject to policy provisions)
But there is a unique difference. Instead of investing your cash value in its general account, the insurance company invest the cash value of your variable universal life insurance policy, at your direction, in a separate account made up of a variety of investment sub-accounts, Each of these sub-accounts follows a specified investment objective.
We shall understand each one of them in details in the coming days. Please check back shortly.
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