Life Insurance
Life insurance
– a contract in which the insurer agrees to pay a specified amount of money to the insured's chosen beneficiary when the life insured dies. The pricing of the policy can be tailored to fit the expected duration of the policy and the intended use of the policy (e.g. Cover a mortgage, create a legacy).
Whole Life (Permanent) Insurance
- this policy provide coverage throughout the life insured’s life. The premium paid for this policy is an average of mortality costs at a predetermined rate of growth sufficient to fund the policy throughout its existence.
Term Life Insurance
- this policy provides coverage throughout a predetermined period or term. Since it is temporary coverage, pricing can be calculated as annual yearly mortality cost, 5, 10, 15, or 20 year mortality cost or any other period that would cover the expected period of the policy’s existence.
Universal Life Insurance - this policy couples the term insurance mortality pricing with the tax sheltered growth on excess premiums that is part of whole life insurance. Depending on issuer, there can be guaranteed investments and/or variable return investments to choose from.