Every life insurance is a legal contract signed between a beneficiary and an insurer through which the insurer promises to pay a certain amount of money to the insured person’s family in case of their death. The passing away of a person can have various causes, from terminal illness to car accidents or age.
Life insurance in Avon, Cleveland, Lakewood, North Olmsted, North Ridgeville Westlake or anywhere else in the country comes in policies that are generally organized in two main categories: they can be either protection life insurance policies or investment policies.
Protection life insurance
You need to know about life insurance that it comes in two forms: an insurance policy for life, or a term life insurance policy.
The term insurance is included in the “protection” category and includes, in its turn, of three types of policies: renewed every year (known as “annual renewable”), level premium term, and mortgage life insurance.
This kind of insurance provides benefits for specified events. For example, it provides protection in the event of loss of life – and nothing else. It is not cumulative and does not accumulate cash value.
Investment life insurance
As the name suggests, this insurance category is created with the aim of facilitating the growth of capital through premiums. These premiums are of two kinds: single premiums or regular ones. In this category are included the following main types of life insurance: variable life policies, whole life policies, and universal life policies.
This type of life insurance is also known as “permanent life insurance”, and cannot be cancelled for any reason as long as its owner pays their premiums on time. The only situation when a permanent life insurance policy can be cancelled is in case of fraud.
There are several more types of life insurance policies, such as insurance for accidental death, limited pay insurance, and so on. If you want to find the best life insurance for you contact an insurance agent today.