The truth is, life insurance can be as vital to your financial strategy as your savings, because life insurance can protect your family and the wealth you’ve built. For example, if you were to pass away unexpectedly, it can help:
- Cover financial obligations, such as outstanding credit card or student loan debt
- Pay for funeral and other final expenses
- Cover mortgage payments
- Pay for your children’s education
- Enable your loved ones to maintain their lifestyle
The main types of life insurance are:
Term life insuranceTerm life insurance policies provide coverage for a set time – or term – but build no cash value. Term policies are less expensive than permanent life insurance policies with the same face value.
Permanent life insurancePermanent life insurance policies remain in effect until the policy holder's death, provided premiums are paid. Most permanent life insurance policies also include a component that can build cash value over time.