If you are considering life insurance in CT, then you should understand the two basic types of life insurance that are available. These are:
- Term life insurance.
- Whole life / permanent insurance.
What are the differences between the two?
Term Life Insurance
Term life insurance is the most basic type of life insurance available. It pays out benefits only if the policy holder dies during the term of the policy, generally anywhere between one and 30 years. Once the term of the policy is up, benefits will no longer be paid. The majority of term life insurance policies are level term policies, which means that the benefit to be paid out remains the same for the duration of the policy.
Whole Life or Permanent Insurance
Unlike term life insurance, whole life, also called “permanent,” insurance pays out benefits whenever the policy holder dies. It is not contingent upon a specific period of time, as is term life insurance. While there are several types of whole life policies, traditional whole life policies seem to be the most popular. In a traditional whole life policy, both the premium and the benefit remain level for the duration of the policy. This means that older individuals, who are clearly a higher risk, are not paying more than younger people for the same benefit, provided that the older individuals purchased the policy early in their lives.
If you need life insurance in CT, you agent can guide you further.