View of someone working on their life insurance policy

Life Insurance 101

What Are Life Insurance Policies? 

Life insurance policies can help provide financial protection to loved ones in the event of someone’s passing. The benefit can go to one or multiple individuals, depending on the person who was insured and who was listed as the beneficiary.  

Understanding how these policies work has always confused many people. As such, there are plenty of commonly asked questions about the function of life insurance and its types. To better understand, we listed a few of the frequently asked questions about them. These can help you understand what life insurance is and what type you should get. 

How Does It Help? 

Having a life insurance package mainly provides protection and support in preparation for accidents. For example, for parents, it ensures that their kids can get a bit of financial help in the event of their death. For businesses, policies can cover injuries and hazards that can happen in the workplace. This saves the company and its workers from hefty medical bills. 

What Are the Different Types? 

There are different types of life insurance people can choose from. Typically the premium cost and length of the term determine how these packages are differentiated. For example, a term life insurance package can cover 10 to 30 years. For people who are only buying the coverage and not the cash value, this type is recommended. 

On the other hand, whole life insurance lasts for a lifetime. These types of accounts gain value over time by using part of your premium payment and adding interest. This type of package is recommended for people looking for lifelong coverage who are willing to pay for the benefits. 

Universal life insurance is an option similar to the whole life package. The biggest difference is the fact that universal policies are more flexible in terms of paying for premiums. In emergencies, you can opt to lower or raise the amount you need to pay. 

Universal life insurance can be especially helpful for couples that are expecting a child.  Aside from that, it lets people be more flexible with their payments in case they’re settling debts and such.  

How Do You Get It? 

Most policyholders will require you to fill out an application form. Some policyholders require a medical exam and you will also ask numerous health-related questions to evaluate your well-being during the application process. Lastly, you will need to pay for the premium of your desired policy. 

Contact a Professional for Helpful Insights! 

Do not hesitate to call our experts at Tostrud & Temp, S.C. in La Crosse, WI. Whether you need help keeping your finances in line or setting up your child’s college fund, we offer services to meet your needs efficiently. We are here to help you every step of the way. Get in touch with us today!