There’s basically two types of life insurance. You have whole life insurance. And you have term insurance. Real quick, whole life insurance is just as the name implies, it would be something you would be wanting or looking to keep for your whole life.
Term insurance, again, it’s just as the name implies, is when you’re just looking for a period of time or a term. Now, in this case of whole life insurance, a person will buy that if they are looking to not have or deal with any type of increase in premium that premium that you start that policy with, regardless of what age you are, will stay the same for your whole life. And also whole life insurance accumulates a cash value. And, and some folks I’ve had experience with who have been clients for a very long time have accumulated cash where they could borrow from that or they could say to the insurance company Take my cash value and let it pay the premium.
So now you’re gonna have that coverage, but you’re not having to put any new money into it. And I have a particular type of permanent, another name for whole life is permanent insurance that I use for, instead of having to go to a bank to ask for a, like, say I need a car loan, I can use my cash value. As a way to purchase a car, and I don’t have to qualify for the loan, I don’t have to answer any questions. I call the insurance company and say, I need $25,000 of, let’s say my cash value’s 50,000. I need $25,000, and I get a check in a couple of days. You know? And a lot of folks will have a whole life policy that’s like their base. It’s like their foundation.
Then you’re gonna have term insurance. And this is a type of insurance that probably the most common term insurance is a 20 year term. So what that means is that policy premium’s gonna stay the same for 20 years. At the end of the 20 years, depending on the company you’ve purchased it from, that policy may stop. Or they’ll say you will continue that, but there’s gonna be an adjustment in the premium. And the premium for the most part is gonna be, the adjustment’s gonna be pretty significant ’cause you’re 20 years older. But a lot of folks will get that. That’s kind of the common, but you can get as long as 30 years. You could get as, you could get a, what’s called an annual renewable, which means it’s a one year policy, but every year the premium creeps up a little bit. But those would be types of policies that a person would purchase if they had a home mortgage. So they have a $250,000 home mortgage. A 20, 25, 30 year mortgage. They’ll get maybe a 30 year term or a 20 year term to cover that mortgage.
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