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Most if not all people wanted to be secured and insured. But one should also look at the process on how can the existing Life Insurance Companies determine the designation of the applicant in the terms and policies they offer. Let’s start off by defining insurability. This is a major factor that the Life Insurance Companies need to consider before issuing a policy to the applicant, which is predetermined by the type of loss or risk. The higher the person’s insurability, the chances is he or she gets a life policy and insurance. For a person who is determined to live for only six months more with a severe ailment has a low insurability that will less likely to get an approved life policy. Why is that? That’s because the uncertainty of death of this applicant is determined or pretty high giving too high liability for the insurance company. Once insurability has been determined, we then proceed in choosing the right policy for us. Term Life Insurance Vs. Permanent Life Insurance Any Life Insurance Companies offer those types of policies. For term life, from the word “term” it has a specified time frame. For life insurance, specifications of time can be for 10, 15, 20, or 30 years. If an insured person dies within the chosen time frame, beneficiaries of the insured receive all the values and grants specified in the policy and that’s tax free. Another good point about this type is that since the period is specified, there’s a fixed amount within the time frame. A renewal of the policy to a higher premium policy is needed once the specified term has ended. A term plan is less expensive compared to the permanent plan, and for those individuals who are on a tight budget can get this type of plan (if applicable to you) while giving more value and death benefits at a lower cost. Though term plan doesn’t have a cash value. On the other hand, permanent life insurance from any existing Life Insurance Companies offer no time limit, unless the policy is surrendered. This is a lifetime plan costing higher than term plan but has a cash value based on the tax deferred. In rare cases, there are insured person who chooses to return the policy and be able to withdraw the cash value of his or her plan. Under the permanent plan are the sub-plans, including whole life insurance and universal life insurance. A Reminder There’s a lot of Life Insurance Companies you can choose from, but the decision will always be up to you. Just a reminder though. Never rely on the insurance policy your company has offered that only cost one or twice of your salary (group insurance). But rather take a big step by choosing your own Life Insurance Companies that give you a lifetime benefit for you and for your love ones. A small part of your pocket in an insurance is not bad after all.
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