If you have a spouse or children who rely on your income to make ends meet, it\u2019s critical to have life insurance. If you pass away, life insurance will provide your loved ones with money that they can use to cover living expenses, such as a mortgage, as well as long-term goals, such as your children\u2019s college education. Insurers offer several types of life insurance to suit customers\u2019 individual needs.<\/p>\n\n\n\n
A term life policy will remain in effect for a specific period of time, and it will pay your beneficiaries a lump sum if you die during that time. A term life insurance policy doesn\u2019t build cash value. Term life insurance generally has lower premiums than other types of life insurance, but premiums for term life can increase as you get older.<\/p>\n\n\n\n
A permanent life insurance policy doesn\u2019t have an expiration date. It can protect your loved ones indefinitely, as long as you continue to pay the premiums. <\/p>\n\n\n\n
You can choose from several types of permanent life insurance. Whole life insurance has fixed premiums, while universal life insurance has flexible premiums. <\/p>\n\n\n\n
If you take out a permanent life insurance policy that builds cash value, it will gain value on a tax-deferred basis. You\u2019ll be able to withdraw or borrow money from the policy\u2019s cash value while you\u2019re alive. Some types of permanent life insurance will allow you to invest the policy\u2019s cash value.<\/p>\n\n\n\n
When you take out a life insurance policy, you\u2019ll have to designate one or more beneficiaries who will receive funds from the policy after your death. People generally name their spouse and\/or children as beneficiaries, but you can name a different individual. If your circumstances change (for example, if you get married or divorced or have another child), you can update your beneficiary information.<\/p>\n\n\n\n