Navigating the different types of life insurance can be a daunting task. At Aflac, we want to help you simplify your search and guide you to find the life insurance policy that best fits your lifestyle. Every life insurance plan is different, so it's important to understand the various types of life insurance available. Term life insurance is a great option if you're looking for coverage to cover a mortgage or other debts.
You can choose the term, duration and amount, and provide your family with more than just the mortgage money. They may decide to use the money elsewhere. Permanent life insurance policies, such as whole-life, universal life and variable-life policies, allow you to borrow under them. Term life insurance policies do not. Full life insurance is a type of permanent coverage that lasts a lifetime.
The benefit will be paid to your beneficiary each time you die. This may be a more expensive option from the start, but the benefits may be safer in the long run. Full life insurance may be the best type of coverage if you're looking for guaranteed support for your loved ones at any time. It can also be a wise decision if you hope to consider long-term financial planning. Universal life insurance works differently than term and full term life insurance.
It is a type of permanent policy that has an investment part, also known as cash value, which can grow over the life of the insured in a tax-deferred account at a stable rate. Group life insurance is a great option if you're looking to provide benefits to your employees or members of an organization. Indexed universal life insurance (IUL) differs from other forms of universal life insurance (UL) due to the way in which the cash value fluctuates. Universal life insurance can be cheaper than full life insurance because it generally doesn't offer the same guarantees. Final expense insurance is a type of policy that covers the cost of anything related to your death. Permanent or lifetime policies generally offer the advantage of lifetime coverage, but may charge higher premiums than fixed-term life products.
The interest rate on a universal life insurance policy is influenced by current market interest rates. Variable life insurance deposits money into sub-accounts similar to those of mutual funds, with potential for decent growth and risk of losing money depending on the market. Even after knowing the differences between each type of plan, it can be confusing to choose the right one. A term life policy is purchased to last for a specific period, such as 1, 5, 10, or sometimes up to 30 years. In the case of traditional lifetime benefit, both death benefit and premium are usually designed.