Life Insurance Made Simple

photo credits to life-insurance-types.org

A life insurance plan is probably one of the most worthy investments a person can make in his lifetime. With this kind of insurance, a person will have peace of mind, assured that even if something unfortunate happens to him, he and his loved ones will be taken care of financially. A person can choose to get either of the two basic types of insurance plan: the term life plan and the permanent life plan.

The Term Life Plan

The term life plan is the more affordable option between the two kinds of life insurance. This kind of insurance was designed for meeting temporary needs in life. This kind of insurance provides protection for a limited, or specific, period. For instance, a term life plan, could last for a specified term of 10 or twenty years and then expires, leaving the policyholder with no financial protection for the succeeding years. A term life plan does not have a cash value, however, if the policyholder dies before the term ends, the beneficiary of the insurance will receive what is referred to as the death benefit (a tax-free amount).

The Permanent Life Plan

As the term suggests, a permanent life plan offers protection for as long as the policyholder lives. As long he pays the insurance premiums, his financial protection will continue. Also, a permanent life plan offers a savings benefit that builds up to a certain amount of cash over time.

Types of Permanent Life Plans

There are several types of permanent life plans. With these different kinds of permanent life insurance plans, a prospect policyholder can choose the kind of plan that will fit his situation. Types of permanent life plans include disability insurance, long-term care insurance, and critical illness insurance.