Choosing Between Term And Universal Life Insurance

Surely anyone who has been in the market to purchase a life insurance policy has run into the confusing array of plans available. The following will give you a brief summary on two of the most popular life insurance coverage choices: Choosing between term or universal life.

Term Life Insurance

The first thing to understand is that term life insurance is known as “pure” insurance. That means that term life is straight life insurance and does not build any cash value. You can buy this coverage for a certain amount of years, known as the “term,” and once the term is over you may either renew the policy for another set amount of time or simply walk away. The advantages of term life insurance is that it is the least expensive life insurance policy because it serves no other purpose other than to give your beneficiaries peace of mind knowing they are financially protected in the event of your untimely death. It is basic and to the point. To get more information on term life insurance visit http://www.equote.com/li/termlifeinsurance.html.

Universal Life Insurance

Universal life insurance is a type of permanent life insurance. Permanent life insurance policies offer death benefits and a "savings account." Unlike term life policies, permanent policies build cash value.  The advantage of buying a permanent type of life insurance is that if the insured outlives the initially established term, they will be reimbursed some of--often more than--the amount set on the original premium. To learn more about universal life insurance visit http://www.equote.com/li/universallifeinsurance.html.

In addition, universal life insurance policies are known as the flexible policy because you are allowed to vary your life insurance premium payments as well as adjust the face value of your coverage. Keep in mind that you must maintain enough premium payments so that the cash value on your account does not drop below the charges against your account. The more you put into this account the higher your cash value will be for future use. Universal life policies will have higher life insurance rates because it also serves as an investment vehicle.

Choosing Between Term and Universal Life Insurance?

There are a few things to consider when deciding to choose between term life insurance and a universal or permanent life insurance policy. For example, term life insurance is really a good choice for those who may have limited funds and not many responsibilities. Usually younger people choose term life insurance because they have a lower risk of dying in the immediate future. Younger investors feel that they can have the best of both worlds: coverage for themselves and their young families while also being able to use the money they save on cheaper insurance for other investments or assets.

While term life insurance seems to be a relatively short period solution, permanent or universal life insurance coverage is more advantageous for those who have built more assets and accumulated more money. A universal life insurance policy can be tapped into as a retirement account to allow for “golden years” enjoyment.

The best thing to do is contact your financial advisor for current life insurance rates on both term and universal life. Your financial advisor can also assist you in deciding which life insurance policy would best suit your current needs as well as forecast what might be needed in the future. To read more about term life insurance and universal life insurance go to http://www.equote.com/li/universalvsterminsurance.html.

Better Deals For Life Insurance Policyholders

It was announced in May this year that the industry regulator the Financial Services Authority are asking for better treatment for those who hold life insurance policies in the UK and those who wish to purchase life insurance cover. It seems that some advisers selling life insurance policies are giving consumers very poor advice regarding the product, both before the sale has taken place and after.

In an insurance sector briefing issued by the FSA, it said that the after sales care when it comes to life insurance was seen as being very poor with some consumers thought not to have been treated fairly. There are also concerns over the quality of the product that some consumers are getting. Sarah Wilson who is director and sector leader of the Financial Services Authority insists that the findings where significant and that consumers should be able to be make the right choices when it came to purchasing the product.

The report said that consumers currently cannot make the right choice for themselves regarding their profits policy, because they simply don't have the necessary information by which to do that. Consumers can be given very poor information before and after they have been sold a policy, which then leaves them unsure about what they have paid for and have actually bought.

In response to this and to try and rectify the situation the Financial Services Authority are asking those that sell the insurance to take more time out to make sure the consumer is more aware of the product they are purchasing. If the product isn't understood then it needs to be clearly explained in jargon the consumer understands.

Sales of the product clearly need to be assessed with staff making sure the consumer understands the performance of the policy and the features of the product.

If the sales techniques and advice given in general about the product isn't stepped up to ensure the consumer understands the product, then the Financial Services Authority are insisting they will start to hand out fines as a way of dealing with those advisor's and companies who don't put the consumers best interests first.

The Independent newspaper has said that the Association of British Insurers have welcomed this with open arms and accepted the Financial Services Authorities recommendation when it comes to consumer satisfaction regarding their life insurance policy.