Title = Whole Life vs. Term Life Insurance Policies

Insurance policies are important in case of unpredictable or untimely deaths in a family. The person who is deciding on taking out an insurance policy can easily compare life insurance quotes online. The whole life insurance policy was more popular from the 1940s to 1970s and term life insurance policies were not very prevalent. It is important to gather key pieces of information on each type of policy and know the advantages and disadvantages of each.

Whole Life Insurance Policy

This type of life insurance policy is guaranteed to remain intact for the entire life of the insured person, hence the term “whole life”. This however is based on the fact that the required premiums are paid or to the maturity date. Whole life insurance policies sometimes also offer other benefits such as eligibility to earn dividends, guaranteed cash value accumulation once the premiums are paid or also access to cash value through a loan or a partial surrender. In determining the best option you can easily obtain life insurance quotes online. The whole life insurance policy provides life-long insurance protection. Your health is not a factor once the policy has been approved and it cannot be cancelled by the carrier as long as premiums are paid in time. This policy build guaranteed cash value which you can actually use in the future through a policy loan.

Term Life Insurance Policy

The term life insurance policy provides coverage for a specified number of years or for a specific period. If the insured dies within this time period then a benefit will be paid out. This type of policy is beneficial to those persons who may not be able to purchase the whole life policy. A person can compare life insurance quotes online from different companies offering the term insurance option. Term insurance is provided in varying number of contract periods annually in increments of 5-year, 10-year, 20-year and 30-year.

The Decision Between the Two

The whole life insurance policy is ultimately the best choice to make. As it relates to the benefits the whole life insurance policy has a cash value which builds up as time passes. With this policy a person can actually borrow the money if they need to however with a term life insurance policy there is no such benefit and in order for any money to be paid out someone has to die. Dividends are available with a whole life insurance policy but there are little or no dividends at all with a term life insurance policy. There are different sites which provide life insurance quotes online to also aid in the decision of the policy.

Needs and life change and an insurance policy should change with your life. Some persons may want the added security of a whole life insurance policy. It is important that no matter what policy type you chose that you always compare quotes from different reputable companies so that you are selecting the best option. You can compare life insurance quotes online and save yourself any hassle of visiting different agencies.

Read more here: http://www.investopedia.com/articles/pf/07/five_policies.asp

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