If you’re in the process of selecting a life insurance policy, you might feel a bit overwhelmed by the vast amount of options. Understanding the various policies available and the benefits they each offer is crucial to selecting the right coverage for your unique needs. To move forward with your purchase and have peace of mind, reference the guide below.

3 Different Types of Life Insurance

1. Term

Term life insurance policies only provide coverage for a predetermined amount of time. During that period, they don’t increase in cash value. If you pass away while your term policy is still in effect, any designated beneficiaries will receive their specified payouts. If you’re still alive at the end of your policy, the coverage expires. Many people opt for this policy because it is the most affordable and allows you to pay the same premium every month or year. 

2. Whole

Unlike term life insurance, whole life policies provide coverage for your entire life. This option comes with a locked-in premium and interest rate, as well as guaranteed benefits for your beneficiaries. Additionally, whole life policies accumulate in cash value for the duration of your policy, and a portion of your premiums are put aside into a savings account. This option is attractive for parents that want to provide their children with coverage at a manageable rate that will last their entire lives.

3. Universal

Universal life insurance policies are similar to whole life policies in that they are permanent, offer locked-in rates, and put portions of the premium toward savings. The primary difference between the two is the flexibility universal policies provide. With this option, you can select how much of your monthly or annual premiums are put aside toward savings and how much is put aside for death benefits.

If you need help selecting a life insurance policy, enlist the team at Hummel Insurance Services in Oakland, IA. Since 1944, they have provided residents throughout Pottawattamie County with top-quality coverage options designed to fit their unique lifestyles. Their team of knowledgeable professionals can evaluate your needs and provide guidance on creating coverage that will let you rest easy. Visit their website to learn about their services, and call (712) 482-6424 to discuss your needs with a team member today.