Permanent versus Term Life Insurance
Is it better to purchase term life insurance or universal life or whole life insurance? The answer to this questions often depends on who answers the question. The obvious difference between the two products is that term life insurance is for a specific "term" of time and less expensive. Universal Life or whole life products are desinged to be permanent life insurance products. The least expensive life insurance product for a specific face amount is term life insurance then universal life and whole life insurance in that order. The major advantage of using the web site at CompareLifequote.com is that we shop the term life insurance market for you to find the lowest cost term life quotes. Instead of talking to 100's of term life insurance companies and agents you can receive a free instant term life insurance quote online with out the hassle of a salesperson and save money.
To compare the cost difference we will look at a 45 year old male preferred plus nonsmoker for $500,000 of coverage. The cost of a 10 year term life insurance policy is $330, a 20 year term life insurance policy is $614, and a 30 year term life insurance policy is $995. Compare these costs to a unversal life policy guaranteed for life at $2810. As you can see there is qute a difference in premiums depending on how long you want to have life insurance coverage. There is some life insurance agents and advisors that contend that atleast with the universal life policy you are guaranteed to get a death benefit. This is true but is it worth it? We believe at CompareLifequote.com that you should consider purchasing term life insurance and investing the difference. For example, purchase the 30 year term life insurance product for $995 and invest the diferrence between the 30 year term and the universal life policy premiums. This amount is $1815 which can be invested in a well diversified stock index mutual fund. The major advantage of this approach is that equity index funds will have a higher return on you investment over time versus fixed income investments which is what most life insurance companies invest in. There are other advantages of term life insurance. If you pay your mortgage off, save and invest your money, children grow up, then as you grow older the need for life insurance usually decreases. When you are younger with a mortgage and children the need for more life insurance is more affordable with term life insurance than universal life insurance.
The best product to purchase for life insurance will always depend on the individual, family, or business circumstances. However the comptitive term life insurance market is becoming more popular for the reasons above.
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