Term Life Insurance

Term Life Insurance is a straightforward and affordable option, requiring only two decisions - the desired coverage amount and duration.

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• Pros: It’s easy to understand and is the cheapest way to buy life insurance. You can compare term life insurance quotes online.

• Cons: You could outlive your policy. If you still need coverage when the policy expires, you’d need to buy another policy and will pay more based on your age and, possibly, health.

 

Whole Life Insurance

Whole Life Insurance offers lifelong coverage with guaranteed rates and benefits, though it comes at a higher cost.

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• Pros: It covers you for your entire life. Everything in the policy is guaranteed, so there are no surprises.

• Cons: It’s a very expensive way to buy life insurance.

 

Guaranteed Universal Life Insurance

Guaranteed Universal Life Insurance provides a cheaper alternative to whole life insurance, but demands on-time payments to maintain the guarantee.

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• Pros: It’s cheaper than whole life and other forms of universal life insurance. You can choose the age to which you want the death benefit guaranteed, such as 95 or 100.

• Cons: You must make every payment on time or you could lose the guarantee and forfeit the policy, thereby losing all your previous payments. The policy may have little or no cash value.

 

Indexed Universal Life Insurance

Indexed Universal Life Insurance ties the cash value to a stock market index, offering potential for growth but necessitating an understanding of associated fees and limitations.

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• Pros: You can access cash value, which grows over time. The cash value is linked to a stock market index, so if the stock market goes up, you get some upside, too. Within limits, your payments and death benefit amount are flexible.

• Cons: Your cash value doesn’t take full advantage of stock market gains. Understand the policy’s fees and participation rates and the cap on your return before you buy.