The three types of life insurance are term, whole, and universal.
Term life insurance is a policy that pays out a fixed amount upon the death of the insured person. This type of life insurance pays out money to your beneficiaries only after you die. It's usually owned by companies that sell policies to individuals and families, but some employers may offer it as part of their benefits package.
Whole life insurance is an investment plan that pays out an amount based on the face value of your policy at maturity. It's often sold by banks or other financial institutions because it has low administrative costs. it doesn't need ongoing management or maintenance, as long as there are no changes in the beneficiary list or other terms of the policy.
Universal life insurance is similar to whole-life policies in that it has a guaranteed payout value when you die; however, it has additional perks such as guaranteed premiums, higher rates of return than whole-life policies tend to offer (though they can still be lower than non-guaranteed term policies), and sometimes tax advantages over whole-life policies because they're not tax deferred.
Term life insurance is a policy that pays out a fixed amount upon the death of the insured person. This type of life insurance pays out money to your beneficiaries only after you die. It's usually owned by companies that sell policies to individuals and families, but some employers may offer it as part of their benefits package.
Whole life insurance is an investment plan that pays out an amount based on the face value of your policy at maturity. It's often sold by banks or other financial institutions because it has low administrative costs. it doesn't need ongoing management or maintenance, as long as there are no changes in the beneficiary list or other terms of the policy.
Universal life insurance is similar to whole-life policies in that it has a guaranteed payout value when you die; however, it has additional perks such as guaranteed premiums, higher rates of return than whole-life policies tend to offer (though they can still be lower than non-guaranteed term policies), and sometimes tax advantages over whole-life policies because they're not tax deferred.
