Whole life insurance product is suitable or appropriate for someone who needs protection in the long term and only pays a premium for a certain period only. Whole life is also suitable for someone who wants to give an inheritance or a memory to a loved one in the desired form of welfare money. With the coverage period of up to 99 years, arguably whole life insurance is a life-long protection.
When compared with the type of term life insurance, whole life can be more profitable. It is because of the contract was valid for a lifetime. While the term life insurance needs to be updated within a certain time frame. If the contract of term life insurance runs out and will be extended again, it could be a bigger premium or you just cannot continue the contract.
Why? It is because of health risks are increasing along with age. Moreover, if after repeated health checks, meet some new disease. This risk would be transferred to a larger premium value. Perhaps, you could not afford to pay the new premiums so you are not protected by life insurance.
Another benefit, if until the end of the contract and you are still alive, you will get cash value. We cannot find this cash-value benefit in the term life insurance. In fact, there is a type of whole life insurance that provide a return on cash, called dividends or bonuses, if there is no claim for a certain period.
Indeed, the whole life product originally born out of dissatisfaction of the term life policy holders who feel loss because premiums are scorched away when there is no claim until the policy contract expires. With such advantages, it is reasonable that the premium of whole life insurance is more expensive than term life products.
Thus, both types of life insurance is having a plus and minus. It is now up to you to select which insurance fits your needs and your abilities.
To have a whole life insurance policy, the insurance company usually specifies the requirements are simple. Simply attach the personal documents, health checks, and pay a certain premium, then you will already get a whole life insurance protection.
Although the product is fairly simple, there are some things you should note and consider before buying this whole life insurance product. It is suggested, before determining the product, you should select an insurance company that sells whole life insurance product with a long operational experience and proven to easy to claim.
You should investigate the company's performance. Make sure the company is a leading business group and have high integrity. This is important because the product to be purchased is a product with protection for good or for life.
Next, adjust the requested sum insured so that appropriate and valuable to the loved ones we leave behind. Whole life insurance has weaknesses; the sum insured can not be added or subtracted. That is why you must determine from the beginning, the sum insured is sufficient to the needs of your family in the future. Buy it when you still at the young age, so as would be more economical.
It is better that you do not mix the whole life product with unit linked insurance. It is because of the investment return is not optimal due to a lot of fees charged by insurance company. The insurance company will cut the investment funds as a management fee or other expenses. Usually the insurance company will delegate the fund management to be handled by a third party, such as investment managers, which automatically all costs are also charged to the customer.
Now, you can identify yourself to choose life insurance that best fits your condition, especially your personal financial planning. Having a life insurance is necessary and important to be included in your financial planning.
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