There are four different types of life insurance: variable life insurance, universal life insurance, whole life insurance and term life insurance. When purchasing life insurance for yourself or a member of your family, it’s helpful to understand the different types before making your final decision.
Variable Life Insurance
A variable life insurance policy is a permanent policy that provides a variable death benefit to a designated beneficiary upon the policy holder’s death. With a variable policy, you can allocate part of your premium to an investment account composed of a combination of equity funds, bond funds, money market funds and stocks. When your investments earn a good return, you can apply this amount to your premiums and reduce your out-of-pocket cost, or you can allow them to build up in the investment account.
Universal Life Insurance
If you purchase a universal life insurance policy, you will pay at least a minimum premium, but you can opt to pay in more as an investment. However, unlike a variable insurance policy, you can’t choose your own investment vehicles. In most cases, your extra funds will be invested in mortgages and bonds, but this decision is ultimately up to the insurance company.
Whole Life Insurance
A whole life insurance policy is a permanent policy that covers you for the duration of your life and pays a set amount to your beneficiary when you die. The Whole Life Plan from Gerber Life offers you coverage amounts of $25,000, $50,000, $75,000, $100,000, $125,000 and $150,000. One of the greatest benefits of whole life insurance is that you can keep the policy throughout your entire lifetime at an affordable premium rate that will never increase.
Term Life Insurance
Perhaps the simplest form of life insurance, term life insurance covers you for a specific period of time in exchange for the payment of a predetermined premium. You determine the length of the policy when you purchase it. If you die before the term ends, your beneficiary receives payment. If you are still alive when the policy’s term resolves, you can surrender it, renew it or convert it to a different type of policy. With Gerber Life’s Term Life insurance, your option to renew is guaranteed — without a physical — at the end of your term.
Which type of life insurance plan is right for you? Compare the different types of life insurance policies and request a quote from Gerber Life to weigh your options.