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Life Insurance Policies and Life Insurance Quotes

By Charles Hopkins Published 10/26/2007 | Insurance
Getting a life insurance policy is one of those important life decisions that shouldn't be mucked around with.  Different people have different circumstances and different needs, so they should have the final say about the policy they will purchase.  It helps to ask the advice of loved ones, friends and professionals working in the insurance field, but in the end, the decision is all theirs to make.

Types of Life Insurance Policies

A person has mainly two general options to choose from when selecting a life insurance policy - term life insurance and whole life insurance.  Term life insurance is also known as "pure" life insurance, and it is the kind of deal that people are probably most familiar with.  The insured person takes out a policy for a set length of time (1-, 5-, 10-, 20-, and 30-year durations are common) and periodically pays an amount called a premium into the policy.  Should the insured die sometime in the duration, the beneficiaries will receive the face value of the policy, usually tax free.  If the insured lives past the term, the policy will expire.  Some policies can be converted into cash value life insurance or renewed.  Many companies require physical examinations when renewing a policy, and premiums often get more expensive as the person being insured gets older and therefore becomes a greater risk to the insurance company.

Cash value life insurance policies also pay beneficiaries a sum when the policy holder dies.  The difference is that part of the premium is used as investments or savings.  The mortality charge of the premium is used to pay for the cost of the insurance coverage.  The rest of the amount, known as the reserve, is put into savings or invested.  Unlike a typical term life insurance policy, a cash value policy can be converted into money at a rate determined by its surrender value.  There are many variations of cash value-type policies such as universal life insurance with its flexible premium payment options; variable life insurance policies which allow the policy holder to choose which stocks, bonds or other investment options to put their money in; variable universal life policies; fixed premium variable life policies; etc.

Using Insurance Quotes to Find the Best Deals

Getting the right life insurance means different things for people.  For those who don't have family, it can be a way of providing for their burial.  For those who have family, it may be a way of ensuring their loved ones will remain supported even after they have passed on.  In order to be able to measure the value of a particular policy and determine that its right for them, those looking for life insurance options should canvas and gather a variety of life insurance quotes and go over them, preferably with the help of a knowledgeable advisor as picking the right policy from the multitude available is not an easy task.  A life insurance quote is simply a summary of the insurance plan, of the benefits you can get by obtaining the deal.  Life insurance quotes are available at the local branch of any insurance company.  They can also be found online.  The quote usually states the benefits of the policy, how long it will last, how much it will cost, and whether it can be renewed or converted.