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If you want to ensure financial stability for your loved ones after you pass away, investing in a comprehensive life insurance policy is ideal. When you're ready to do so, you'll need to choose between a term and a whole plan. The following guide outlines the differences between the two, so you can select the best option for your family's needs.

Term Life Insurance

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A term life insurance policy provides a guaranteed payout for your designated beneficiaries within a predetermined period. You can decide how long the term will be, but on average, they're available for anywhere from 10 to 30 years. Your insurance provider will determine the payout amount you qualify for depending on your health, age, lifestyle, and risk level. For example, if you have a preexisting condition, you may not be eligible, as providers often view individuals with existing health conditions as a greater liability.

This type of plan is most popular amongst younger clients in good physical health because the premiums are affordable and allow for reconsideration at the end of every term. If the policyholder has built up enough wealth by the time the policy expires, they can simply opt out of renewing. If not, they can easily request a renewal to provide financial coverage for their loved ones.

Whole Life Insurance

Unlike a term policy, whole insurance offers coverage for the entirety of the policyholder's life. When they first sign up, the client assigns a death benefit (or payout) to a beneficiary of their choosing. They also can create a savings account, which is funded by a portion of their premium. Throughout their life, the account builds with interest; furthermore, clients can choose to borrow against these funds should they need financial assistance. If they cannot pay back the amount they've borrowed before their passing, the outstanding balance will simply be subtracted from the designated death benefit.

 

Enjoy the peace of mind of knowing your family is taken care of with a life insurance policy from North Carolina Farm Bureau Insurance® Group in Matthews, NC. For over 65 years, this reputable, local agency has provided residents with a broad range of coverage options, from car insurance to workers comp. Learn more about their offerings online, or call (704) 841-8700 to request a quote.

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