It’s understandable why people don’t want to think about it, but everyone needs life insurance. It’s usually better to bite the bullet and get a plan, so you don’t have to worry about it. When you’re shopping, you’re going to find a lot of options. The only hope of picking the best policy is to understand the main classifications of life insurance. That’s why Stalwart Insurance in Pittsburgh, PA made you this quick guide to differentiate between term, whole, and universal life insurance.
Term
This is probably the most common policy you might get from an employer. The name says it. The insurance policy covers a preset term or time. The period is usually 10 to 30 years (it will be fixed when the policy is chosen). You pay a fixed monthly payment, and there is a predetermined payout. Once the term expires, a new one has to be negotiated.
Whole Life
Like the name implies, these policies cover your entire life. The premiums are usually higher because these policies are guaranteed to eventually mature. The premiums for whole life are typically fixed, but the money you put into the account can appreciate, and it is tax-deferred. This allows the policy to grow beyond your contributions, and the final payout can be much bigger than what you might get for a comparable term policy.
Universal
This is also a permanent insurance plan, but it differs from whole life in several ways. First, universal policies typically have flexible premiums. These accounts are more directly tied to investment performance. The money you put into the policy is invested by the insurer, and the idea is for it to grow over the course of your life. Because of the flexible premiums and reliance on investment performance, the payouts of universal policies are less predictable.
This should be enough to get you started, but you ultimately want a customized insurance solution. A quick chat with your Stalwart Insurance representative in Pittsburgh, PA can ensure that you know what you’re getting into, and that it’s the right fit.
