What’s the difference between term life insurance and permanent insurance?

Even though it can be uncomfortable to think about why you need life insurance, it is important to start planning as early as possible so that your loved ones will not need to deal with these uncomfortable issues on their own. If you are in Denver, CO, you can speak to the agents at Alliance General Insurance Agency to compare options and coverage amounts.

Life insurance can be used to take care of necessary expenses when a person dies, but a healthy life insurance policy can also provide other needed financial support at a time when it is needed most. It is often used to pay for burial costs, debts, and unpaid medical bills. Families can focus on the important act of grieving instead of worrying about money.

The first thing you will need to decide is whether to purchase term life insurance or permanent insurance, also called whole life insurance. Term life insurance provides a death benefit but has no cash value. Premiums will go up at predetermined intervals, such as after 1, 5, or 10 years, and it can supplement whole life insurance.

Whole life or permanent insurance helps individuals meet long-term goals by allowing users to accumulate the money over time, on a tax-deferred basis. You can even borrow against the cash value of your policy. As long as you pay your premiums, your whole life insurance policy will be in effect. 

Which kind of policy is best for you depends on your current goals. If you are in Denver, CO and want to discuss your options regarding life insurance and find the best policy for yourself or a loved one, please call our friendly agents at Alliance General Insurance Agency today for free advice.