Do you have a clear understanding of what life insurance is?
Do you have a clear understanding of what life insurance is? Despite the recurring nature of the topic, some individuals need clarification on what life insurance is and underestimate its significance.
In simple terms, life insurance is a contract established between an individual and an insurance company. In this contract, the individual pays a monthly fee, known as a premium, in exchange for their designated beneficiaries receiving a payment or benefit upon the individual’s passing.
In other words, life insurance policies provide financial support to loved ones, which they can utilize to cover the deceased family member’s funeral expenses, outstanding debts, children’s education, or any other expenses they may have. It’s money that the beneficiary receives in full, free of taxes.
By acquiring a life insurance policy, those who depend on you will be safeguarded in the event of your absence. It ensures they’ll have the necessary funds for their livelihood.
There are two main types of life insurance: term life insurance and permanent life insurance. Term life insurance can be for 10, 15, 20, 25, or 30 years and is designed for individuals who want to protect their loved ones for a specific period. For instance, five years while they pursue their studies. It’s also precious for entrepreneurs looking to shield their family or business partners from debts during the initial years of a business venture.
On the other hand, permanent life insurance remains in effect for the insured’s entire lifetime. Within this category, there are various subcategories tailored to different policyholder needs.
Furthermore, life insurance can serve as a wealth-building tool and a way to leave a legacy for your family.
If you’re considering a way to protect your loved ones, it’s advisable to contact a Univista Insurance specialist. They can assist you in selecting the best financial security for your family. Do you have a clear understanding of what life insurance is?