Permanent Life Insurance
Designed to provide lifelong financial protection; as long as the necessary premiums are paid, the death benefit will be paid. Most permanent policies have a feature known as cash value that increases (tax deferred) over the life of the policy and can be use to help fund financial goals (e.g., retirement, education expenses).
Survivorship or Second-to-Die Life Insurance
This type of life insurance covers two individuals and pays the death benefit at the death of the second insured. The premiums are significantly less than two traditional insurance policies because the policies insure two lives for one benefit. For older individuals with some health considerations, this may be a viable option for coverage. The policy can be designed using either whole-life insurance, term insurance, universal life insurance, or a combination of these. This product is frequently used in the disability market because the major concerns usually develop at the death of the second parent (or caregiver), a time when money is often needed the most.
Term Life Insurance
This type of life insurance covers the insured for a certain period of time, or term. The policy pays death benefits only if the insured dies during the term, which can be 1, 5, 10, or even 20 years.
Universal Life Insurance
A type of permanent life insurance that allows you, after your initial payment, to pay premiums at any time, in virtually any amount, subject to certain minimums and maximums. This policy also permits you to reduce or increase the death benefit more easily than a traditional whole life policy. To increase your death benefit, the insurance company usually requires you to furnish satisfactory evidence of your continued good health. Unsecured debt: A debt or money owed that is not backed by assets or collateral; such as credit card debt.
Whole Life Insurance
The most common type of permanent life insurance. With this type of policy, premiums generally remain constant over the life of the policy and must be paid periodically in the amount specified in the policy.