Life insurance is something that should be in every family’s financial plan and why not? The benefits it has to offer are significant. It secures your family financially in case you are no longer in this world. Life insurance provides peace of mind.

The decision to choose the right life insurance is very important. With so many types of life insurances, you must do a little research to choose the right one. This article discusses the common types of life insurances so that you can find the best life insurance for you.

Term Life Insurance

This is the simplest and the most affordable option.  It pays a fixed amount to your family if you die within the term of your insurance. Your family can use this money to pay for funeral expenses or debts. The terms for which the policy can be bought are 5, 10, 15, 20, and even 30 years.

You should get a policy that is 10 folds your yearly income so that you will receive your income if something goes wrong. The drawback is that you will not benefit from the insurance if you outlive the insurance’s term. Moreover, the cost increases with age.

Choose term life insurance if

  • Need insurance for a particular time period. For instance, if your children are young and want to pay for their college tuition, you can consider a more than 10 year term period.
  • If you have to pay off your debt, then you should consider the term period when the debt will be paid off.
  • Looking to pay less but need a larger amount.

 Permanent Life Insurance

Permanent life is a little complicated, and as the name suggests, this insurance goes on until you stop paying or die. Through this, you can secure the future of your loved ones in the case of your demise. And you can even invest and save your money in your account. This is known as whole life insurance cash value.

You deposit money every month, which builds up in your account as long as you keep on paying. You can borrow this money later on when you need funds. Even though the premium amount is more than that of term insurance, the premium for permanent policies remains the same throughout the age.

There are various types of insurance policies like whole life, universal life, and variable universal life insurance.

Choose permanent life insurance if

  1. Looking for an insurance policy to last you a lifetime. This policy will pay a death benefit no matter when you die.
  2. You want to accumulate wealth through tax-deferred savings. You can use the savings to pay for premiums or for paying your child’s college tuition or something else. But since this is borrowed money, you need to pay it back. So if you die before repaying, your insurer will subtract the amount you had to repay and then pay your dependents what’s left.


That being said, you should choose life insurance that is simple, inexpensive, and understandable to you. If you are still unsure about the best type of insurance for you, then contact an adviser today!