Monday, June 2, 2014
Life insurance For New Parents
We want the best for our children however, we cannot predict the future and in an event of an untimely death there will be tons of financial headache like medical bills, funeral bills, or home mortgages. Don't worry you can plan ahead and have a financial safety net to ensure there’s money available for these expenses. Life insurance can be your safety cushion to save you from this financial disaster.
There are two kinds of Life insurance policy, Term insurance and Whole Life Insurance (permanent insurance or universal insurance).
Term insurance - insurance gives you coverage at a fixed rate of payments for a limited period of time. You pay premium for 10 years or 20 years and it entitles you to a specific amount of money. In an event that the policyholder dies during the policy term the beneficiaries are entitled to the payout.
After that period term expires any premiums paid are lost. However, there are policies that allows they term insurance to be extended but the coverage at the previous rate of premiums is no longer guaranteed.
This insurance is cheaper than the Whole Life Insurance.
Whole Life Insurance - this gives you coverage for the duration of your life. It also acts as a savings where the policyholder can access a portion of the money paid as premiums when it is needed.
Whole Life Insurance premiums are higher than Term insurance.
To make sure you do not overpay for an insurance, since the insurance agent may oversell you their products that you don't need use Life Happens insurance calculator to compute your life insurance needs.
Another tip, life insurance is cheaper while you are younger.