Life Insurance Policy Characteristics TERM POLICIES
Protection for a limited time - generally to 70.
Low initial premium, but rising with each renewal.
Level Death Benefit, unless reducing a benefit plan.
No cash values will accumulate.
WHOLE LIFE INSURANCE POLICIES
Protection continues to age 100, thus the permanent name.
Premium does not increase; may even reduce or cease.
Level or increasing death benefit.
Cash values accumulate on a tax free basis.
UNIVERSAL LIFE INSURANCE POLICIES
Protection continues to age 100.
Premium amount is flexible, may reduce, could increase.
Death benefit is flexible, can be reduced if desired.
Cash value growth reflects the interest rate environment.
Policy owner may alter structure to suit future needs.
VARIABLE LIFE INSURANCE POLICIES
Protection continues to age 100.
Premiums can be fixed, but are generally flexible.
Death benefit is flexible, can be reduced if desired.
Cash value growth reflects equity (stock) environment.
Policy owner may alter structure to suit future needs.
Policy owner may shift investments for diversification.
PARTICIPATING INSURANCE POLICIES
Policies are written by mutual (and a few stock) companies in such a fashion as topermit the gains from investments, mortality and operating efficiencies to be passed on to the policy owner. |
