Life Insurance Basics
Just like auto insurance covers damage to your automobile should an accident occur, life insurance provides money to those that are left behind should something happen to you. Life insurance policies include exclusions and exceptions, similar to an auto policy or a homeowner’s policy.
There are two main types of life insurance policies. The first is called term life insurance, and it offers protection should a specified event occur. Once this specified event occurs (usually the death of the person insured), a claim is paid out in one lump sum. The second type of life insurance policy is a policy that builds cash value as each premium is paid. Whole life and universal life are examples of such policies.
Life insurance premiums are based on the level of risk that the insurer takes by insuring someone. For instance, barring any type of accidental death, it would cost more to insure an older person who has used tobacco for many years than it would cost to insure someone who is young with no history of tobacco use.
Life insurance can be viewed as a way to take care of your family after you’re gone. The grieving process is difficult enough without having to worry about if your family can survive financially without you. For this reason and many others, life insurance is so important. If you have not called your Alfa Insurance® agent to purchase a life insurance policy, do it today. Don’t put your family’s future in jeopardy another minute.