Life Insurance Quotes

Why You Need Life Insurance

Did you know the average cost of a funeral in the United States is now $6500? This number is actually probably on the low side because it does not include things like floral arrangements, the cost of a burial plot, etc. Some experts estimate that the average funeral actually costs closer to $10,000. In 2006, it cost over 95% more to bury someone than it did just eight years before. Clearly, a life insurance policy is necessary if you don’t want to burden your family with these substantial final expenses. Further, if you earn an income, your family would likely be financially devastated in the event of your death if your life is not insured. A life insurance policy can help replace your lost income and provide for your family after you’re gone. Even if you do not contribute an income to your family, you may provide services to them that would be expensive to replace, such as child care, in the event of your death.

The Two Basic Types of Life Insurance

Life insurance policies can be broken down into two categories: permanent and term life. These policies have important differences that you should be aware of before you apply for life insurance quotes. An explanation of each type of policy is included below.

• Term Life -Term life insurance offers protection for a finite period of time, usually 10, 15, 20, or 30 years. If you die while the policy is in force, your beneficiaries will receive a death benefit. If you are still alive when the policy expires, your coverage ceases unless you renew. Term life is a good option for people who would like to supplement existing coverage because they have recently taken on additional financial obligations. Although term life is a simple way to get a lot of life insurance protection on a small budget, it does come with the trade-off of rising premiums. In other words, your premiums will rise as you age, which could make a term life policy unaffordable in your later years. This type of policy does not have any value once the term expires and cannot offer tax-deferred growth on your premiums.
• Permanent Life - Permanent life gives you a lifetime of insurance protection. Your premiums never rise, and your policy also usually has the ability to accrue cash value over time. Some permanent life policies allow you to make investments with your policy, which means your policy will have value beyond just the death benefit. In the long run, permanent life is usually the cheaper of the two types of policies because your premiums remain constant. Many people choose permanent life because they use it as an investment vehicle as well as an insurance policy.