The goal of life insurance is to provide a measure of financial security for your family after you die. A life insurance policy will help them meet the financial needs that your income would have normally covered. Life insurance can be purchased on an individual or group basis. Most group life insurance is purchased through an employer group and is usually term coverage that
is renewed yearly. Show Assessing Your Needs Before purchasing a life insurance policy, you should consider your financial situation and the standard of living you want to maintain for your dependents or survivors. For example, who will be responsible for your funeral costs and final medical bills? Would your family have to relocate? Will there be adequate funds for future or ongoing expenses such as daycare, mortgage payments, or college? You should reevaluate your life insurance policies annually or whenever you experience a major life event such as marriage, divorce, the birth or adoption of a child, or purchase of a major item such as a house or business. Following are examples of factors you may want to consider at various stages of your life:
Types of Life Insurance Policies There are two basic types of life insurance policies:
Term Life InsuranceTerm life insurance is coverage you buy for a specific time period, such as 1, 5, 10, or 20 years, or up to age 60 - 65. Term life insurance has five key features:
Whole Life Insurance
Whole Life Policies with Investment Features
Mandatory Provisions All types of individual life insurance policies sold in Illinois must contain the following provisions:
What type of life policy covers 2 people and pays upon the death?Survivorship life insurance is designed to cover two people on a single policy. These policies, also known as second-to-die joint life insurance, only pay out a death benefit once both policyholders have died. Survivorship life insurance is typically less expensive than two separate permanent policies.
What type of life policy has a death benefit?Universal life insurance and whole life insurance are both permanent life insurance types that offer guaranteed death benefits for the life of the insured. However, a universal life policy allows the policyholder to adjust the death benefit as well as the premiums.
What kind of life insurance policy covers two or more quizlet?A joint life policy covers two or more people. Using some type of permanent insurance (as opposed to term), it pays the death benefit at the first insured's death.
What type of policy covers 2 lives?Joint life insurance covers two individuals who will likely die at two different times. However, the policy only pays a single life insurance benefit. The logical next question is, “When is that benefit paid – after the first death, or the second death?” That's why insurance companies offer two kinds of joint coverage.
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