Term vs Life Insurance Which Is Cheaper
Author: James Mahony

Two types of insurance policies. Term and Whole Life are
available in the insurance market. Most people are confused
about the difference between the two policies. Most of the
buyers are unable to decide which policy is best for them.
Before going in for any type of insurance you must know what
you are buying and what benefit you will get from the insurance
policy. You must know the differences between both the
insurances. You must weigh all the options before you ink your
deal for a particular insurance policy. Both policies have a
different purpose and are not taxed.

Term Life Insurance and Whole Life Insurance- A Comparison

People mostly go in for term life insurance because it is
beneficial for temporary or short time insurance needs. This
type of insurance is suitable for those people who have just
been employed and do not have the desired money to set aside
for insurance, and those who foresee their future insurance
needs are likely to change. It also gives you the option of
selecting the exact period you want yourself to be covered by
the insurance. The other advantage of term life insurance is
that it has lower premium rate as compared to whole life
insurance. The lower premium rate is an attraction for the
insurer as to why not invest the difference in amount between
term life insurance and whole life insurance in something else
for better yield. The only consideration you have to keep in
mind is that term life insurance expires without any maturity
and the premium increases at the time of renewal.

Whole life insurance policy provides insurance for whole life.
It has a fixed premium and can be cashed in. It can be
terminated any time and you can still remain insured for an
adjusted amount. This type of insurance is best suited for
those who have the finances and are looking for long term
insurance needs. Accumulation of cash value is considered as
incidental benefit and not as an investment. The true value of
whole life insurance is known only at retirement when you can
use it as an income rather than as insurance or when you are in
need of final expenses. This is the time when you need the
retirement benefits most.

Basic concept of life insurance must be understood before
selecting any policy. Reason out why you want insurance. Can
you do without it? Consider your age, health, present and
future needs. Most term life insurance policies can be
converted in to whole life insurance policy at a later date. A
combination of both insurances may be the best option.


About The Author: James Mahony is the founder of The Insurance
Handbook - A site dedicated to insurance information.
http://www.theinsurancehandbook.com
http://www.buycheaplifeinsurance.com
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