Types Of Life Insurance Policies

Future is unpredictable. Calamity may strike a person anytime. Life insurance extends coverage to a person's family in his absence. There are various types of life insurance and one can choose a policy that will meet his requirements. If a person is not insured, he is living on the edge and needs to take charge of his life. It renders protection to his family and also allows him to make investments. According to the Canadian Life and Health Insurance Industry, statistics of 2009 reflected strong performance. Life insurance premiums increased 1.6 percent to exceed $15.1 billion. The analysts predict that the number will significantly increase in the year 2010.

There are different types of life insurance policies to choose from. One can take help of an insurance carrier who can guide and suggest the life insurance policy that would be the best. Some of the types of policies are as follows-

• Whole life: This type offers coverage for the whole life and not just for a limited period. The insurance carriers use a portion of the money they receive from premiums as investment. And the premium amount remains at a level throughout. It extends cash value as well as death benefit for the entire term of the policy.

• Universal life: This type comes with cash value account and death benefit. It also offers flexibility as far as making payment for premium is concerned. Cash value is held in the general portfolio of the insurance company. In this type of life insurance, the premium guidelines are broad. Change in the premium amount will affect growth of cash value and death benefit.

• Term life: Coverage in this type is bought for a specific price for a particular period. After the death of the insured, the beneficiary will receive the death benefit. It extends death benefit only for a specified period. If the insured doesn't die within the term of the policy, he gets nothing in return.

• Variable life: This type offers various types of investment options. These are usually referred to as sub accounts. It comes with cash value account and one is allowed to make a decision as to how the cash value account should be invested. One is required to make payments for premiums that are annually fixed. It may extend minimum death benefit that is guaranteed.