Types Of Life Insurance Explained
Types Of Life Insurance Explained
There are many different kinds of life insurance. Term Life, Whole Life, and Universal Life are just three of the most basic kinds. Check out life insurance expert Byron Udell break down the main three different types of life insurance.
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Read the Video!
Hi. I’m Byron Udell, Founder and CEO of AccuQuote.
Since 1986, we’ve helped millions of people save money on their life insurance.
When you boil it down, there are really only two kinds of life insurance: “Temporary” coverage, which is called “Term Insurance”…and “Permanent Insurance.”
Both Term and Permanent life insurance come in various shapes and flavors to satisfy different needs.
Permanent insurance is designed to provide coverage for as long as you live. If your needs are long-term, like estate planning or final expenses, or if you just want to leave a bigger legacy, no matter when you die, permanent life insurance is probably the way to go.
There are lots of different kinds of permanent insurance, but the two primary categories are…whole life and universal life. And I’ll come back to these in a minute.
Term life insurance is, by definition, “temporary” insurance. It’s designed to provide coverage for a limited period of time, typically 10, 20 or 30 years. Term policies are simple and extremely inexpensive. In most cases, your cost each year is guaranteed to remain level for whatever the term is. Again, typically 10, 20 or 30 years. After the term is over, make sure you’re sitting down when you receive your premium notice, because your rates are going to jump up dramatically. Sometimes by a factor of as much as 10 or more.
But some of these policies have a built-in conversion option that’ll allow you trade in your term coverage for a shiny new permanent policy.
Term life makes sense if you know when you’re going to be financially independent or if you’re sure there’s some date down the road where no one will be depending on you anymore financially. Like when your kids are all grown up and your mortgage is all paid off.
Term is also good when you’re younger and your biggest concern is getting the protection in place and keeping your costs down.
If you’re a non-smoker in your 30s and healthy, you can buy a 20-year, $250,000 term policy for less than $20 a month.
Sounds too good to be true? Well, it’s 100% true.
Now back to Permanent Life Insurance. Whole Life and Universal Life insurance are more expensive than Term, but let’s look at what you’re getting for the money.
Unlike term insurance, permanent insurance in generally designed to last forever. You can’t outlive a permanent life insurance policy. With most permanent policies, as long as you pay your premiums on time, your family is guaranteed to receive the death benefit…no matter when you die. Whether that’s tomorrow or 50 years from now.
Unlike term insurance, permanent insurance policies can also build cash surrender values, which can be accessed at any time, for any reason. You can set up your premiums to be level of life…guaranteed. You won’t have to worry about premiums going up when you get older and forcing you to drop the policy. Nor will you have to worry about being healthy enough in the future to have to requalify or replace the coverage. If you like, you can also arrange to pay for the policy over a shorter period of time, say 10 years, so after that, you own the coverage…and no further premiums are due for the rest of your life.
Universal Life Insurance, one kind of permanent life insurance, offers a certain amount of built-in flexibility. You have the ability to change your premiums and death benefits to keep pace with changes in your life.
Whole Life Insurance is what I refer to as the “Rolls Royce” of life insurance. Whole life costs more than all the other types of life insurance we’ve discussed, but it does more. Over time, these policies develop significant cash value that are guaranteed and can be accessed at any time. Regardless of what happens in the economy, each year, the cash values grow…guaranteed.
Best LI video I watch on YT thank you Sir
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He forgot to mention that if you borrow from your whole life policy, you have to pay that back with interest.
How is financial abuse committed? I can explain to you how abusers come strong over their victims.
Is it legal to access the C drive of an insurance agents computer? Yes I have proof.
I’ve failed my producer’s life accident and health exam twice. I Ned serious help or my new job will drop me 😢
https://youtu.be/YaNF5Ds9QEs
Is it illegal to send a check to an insurance agent stating it’s from Anthem when it’s not.
There are whole insurance.
Thank you.
I want to leave some money to my kids and husband when I die.wich insurance is better? And wich company’s is most oldest?
I wonder why he didnt mention you lose your cash value when you die?
https://youtu.be/DkyIBPEwMMo?si=c86tn7z9aYUbUCRo
I just want to tell me wife she’s going to get my life insurance money so she can stfu. Only to set it up and send the money to WWP and other veterans. I’m done with being abused and used by those around me. Seriously drop your info and I’ll see if I can add ya to it for some free money.
of course you own all three kinds of life insurance…. bet you are the life of the party….
Knew NOTHING about insurance but now have a clear understanding of it!! Thank you
I’m tired of the great whore of Babylon aka the insurance industry. Listen con boy you know as well as I that if the slimy underbelly of the insurance industry will sell a life insurance policy it’s only because you know the applicant is GOING TO LIVE. Don’t lie to be boy you full well the only people the reptilian insurance industry will sell anyone a policy is because they fit the 0 risk category. Hay Mr.Fancy suit why don’t you tell the nice people about your satanic policy of how death benefit claims your going to challenge every year. That’s right folks they have predetermined percentage of death benefit claims they challenge every year. If you should suffer the misfortune of an untimely demise don’t worry your life insurance company will be doing everything they can to pay your beneficiary the lump sum of 0. Just remember scam boy there’s a section of hell that burns just a little hotter for insurance executives.
Fuck no. They can bicker over my shit like it’s the 1800s.
This video has helped so much. Taking the life insurance exam on December 5. I feel like I know the concepts, but the modules through the prelicensing course through XCEL solutions confused me so much. Thank you for providing clarity.
What’s the point? Your dead
You didn’t win shit
bravoo
Whole life is a scam. Term is what you want.
There is indexed universal life VL variable life there is whole life and graded life. Term and perm.
This is the worst financial advice ever
♻️🌏🛰️☯️🌌
I have life insurance
ty this stuff is hard.
Great video 🙌😃! Explained everything in simple terms 👌👍. Now I know which life insurance to choose 🤗.
04:15, was the a flex on the viewers?
Really nice content!
This was very helpful!
Ah, so that’s how its done, kinda. So what happens after you pull out some of that Cash Surrender Value? How does if affect your premiums? Your death benefit? Any other part of the policy? Does the cash surrender value somehow return? Does it even go down after you pull some out? What strings come with the CSV?
dont understand
I’m in quite a good mood today because I’ve just found out my ex wife has been struck off my life insurance. Spice World!
Carole brooks flat 1/40 leopold rd Felixstowe ip11 7 np worked in life insurance and robbed the company she worked for and large sums of cash where’s the cash she stole where’s it hidden
UL is universal life. A few types.
Great video! 🙌 It was very informative 🤓 and helped me understand the different types of insurance better. Thank you! 🙏
I’m not sure which type is best for me. There’s so much out there—term life, whole life, universal life
Life insurance
Y’all he’s actually being very misleading, look up what happens to that cash value after the policy holder dies. Also insurance isn’t an investment it’s a coverage learn the difference please. This guy right here is a shark
Very straight forward and easy to understand.
Thank you 🙏🏽
Is it legal to cancel a person’s life insurance by hiding a drafted premium and then threatening to kill the person through the postal mail? Yep that’s illegal.
I don’t care about your stupid insurance
👏
Can someone tell the owner of an insurance policy it is cancelled then alter the documents and become the beneficiary of someone else’s policy. Me thinks it’s been done.
As I approach retirement, ensuring the stability of my 401k after the turbulent year of 2022 is a top priority. I’ve come across stories of investors achieving up to $270k in ROI during this current declining market. Any advice on enhancing my ROI before retirement would be highly valued.
So you said you have three life insurance, so that mean you can have more than one?
Excellent primer. Well done.
Wholelife is a scam, if you need life insurance then get the term life insurance.