Term Life Insurance
A term life insurance policy offers coverage for a specified period of time, meaning that if you die during the term of the policy the beneficiary will receive the specified payout (also known as the death benefit or face value of the policy). Term policies are generally the least expensive type of life insurance and term lengths can be for as little as one year, but policies are more commonly offered for 5-year, 10-year, 20-year, and 30-year terms.
Permanent Life Insurance
Permanent life insurance covers you for your entire life so long as you continue to pay the premiums, and is a category that encompasses several distinct policies, including:
- Whole Life Insurance
- Universal Life Insurance
- Variable Life Insurance
Riders are useful as they allow you to tailor your life insurance policy and gain certain benefits that aren’t available with the standard coverage. However, each needs to be evaluated in the context of your financial situation and the policy being purchased, as many will increase your premiums and you want to make sure they pay off in terms of value.
The riders available for a particular policy change by insurer, so if you’d like to customize your coverage using them, you’ll want to check what exactly is available before you purchase the life insurance.
Burial insurance and final-expense insurance policies are typically whole life insurance policies with low death benefits and limited underwriting. These policies may be referred to as burial insurance, final-expense insurance or funeral insurance, but they all refer to the same type of policy. Burial insurance is primarily designed for seniors who want to make sure their family has money to cover the costs of a funeral or pay off a debt when they pass away.