Are you considering life insurance? If so, thinking about the different types of insurance policies can seem overwhelming. Freedom Life Insurance is here to help answer all of your questions.
The first step in this important decision is to understand your options and determine which type of Freedom Life Insurance best suits your needs.
There are two categories of life insurance policies. The first is permanent life insurance. It is called permanent because, as long as the premiums are paid, the insurance will remain in effect for as long as you live. The premium is typically higher than a term life insurance policy but stays the same through the years. Additionally, there is a savings component in which funds accumulate on a tax-deferred basis. This cash value increases as time goes by. In the future, you will be able to borrow this money for whatever purpose you would like. It can be used to reduce premiums, so your policy will essentially pay for itself. The money can also be received as cash regardless of your credit or ability to repay promptly. The policy death benefit is the collateral for the policy loan.
The second is term life insurance. Term life is insurance for a specific amount of time, for example, 10, 20, 30 years. The initial premium is lower than a permanent policy making it ideal if you need a sizable amount of insurance on a limited budget. Typically these policies pay the death benefit if you pass away within the specified term. Coverage stops at the end of the policy term but can be renewed or converted to permanent life insurance and a medical examination may be required. Term policies usually do not include a savings component that builds equity.
There are many factors to consider when making your decision about life insurance. Contact an agent from Freedom Life Insurance today to help guide you to the right insurance at the right price for you.