Term or Whole Life Insurance Tips to Decide

There  are two main types of life insurance, term life insurance and whole type  insurance, besides two other types that are variable of these;  universal life insurance, and variable life insurance. With so many  possible options, it is hard to make a wise decision, particularly when  you do not know what the best life insurance for your family in 2022 is that you will obtain or the  difference among them. Most people have to practically make the choice  between term and whole life insurance, as these policies provide with  the basic coverage that any regular person needs.

What is Term Insurance?

Term insurance is the name of the life insurance policy that is  cheaper than whole life insurance because it only covers a certain  period of time stated in the policy. Such period is usually set as a  given term of years. however, whether you take out a term insurance for a  few months or several years, this type of policy does not build ca ash  surrender value; although the premiums that you will have to pay for it  are lower, if compared with those that you would have to pay for a whole  life insurance policy.

What is Whole Life Insurance?

On the other hand, whole life insurance is a coverage for the period  of time that its name suggest; a lifetime. This policy remains active  throughout the time of years and the policy holders have to pay its  premiums until death. Because this policy is taken out for a fixed  amount of time, the premiums are usually a fixed amount that has to be  paid year after year.
Their Pros and Cons

The main pro of a term life insurance policy is that you pay less  money in premiums and you will only do it for a short period of time.  However the con of this type of policy is that it does not produce loan  value, while the advantage of whole life insurance policy is that it  does, but premiums are higher and have to be paid forever as long as  your are alive.

Tips to Make a Decision

Now you may be wondering, which of these two types of life insurance  coverage is the right one for you, however if you stop for a moment to  think of these tips, you may find which the better one in your personal  case is:

If you have a job that puts your life at risk for a short period of  time, as an example traveling abroad under risky circumstances, then you  must better take a term life insurance policy.
If you are an elderly or mid-age person who has a healthy life, but  want to avoid post-mortem problems for your family, the whole life  insurance is for you.

If you are an individual of any age but seeking to get life  protection besides the ability to borrow money from the life insurance  policy, then whole life insurance must be your choice.
Finally, if you are still in doubt about what is the best life  insurance policy that you should take out, approach your insurance  company and let one of their agent’s advice you based upon your specific  needs.

Author Bio: Dave Smith is s financial frugal blogger who believes that it is very important to invest into such life necessities as insurance.