When searching for life insurance quote on line, you must remember that there are many insurance companies who aggressively market their schemes. Their goal is to secure more and more customers and improve their profit margins. You must be very cautious and study these schemes carefully before choosing any policy. An important step is to know the two main types of insurance categories  permanent insurance and its sub-divisions and term life insurance.  Once you know the details of these plans well, you can make a smart choice that will benefit your dependents.

You must always remember that you should not sacrifice the needs of your dependents just to opt for low cost life insurance. Many insurance companies will offer extremely low rates of insurance  especially on term insurance just to get more applicants. You must always study the terms and conditions very carefully when you receive such quotes. This involves considering the term period and the coverage amount. Low cost insurance will be given generally for short term periods and for very low coverage. If this suits your needs, you can sign up for it. On the other hand, if you need more coverage and a longer term then ask for other quotes and choose the best policy.

One important research everyone must undertake is to draw a comparison between whole life vs. term insurance. This gives details about both types of policies. At the end of the study, you will be able to make the right decision. The following comparisons of both can be done:
    Premium
    Savings component
    Beneficiaries
    Age
    Health
    
Permanent insurance of which the common types are whole, universal and variable insurance provides lifelong protection to beneficiaries. It has a wealth accumulation component that is tax deferred.  This means that it can be used as an investment vehicle and also gives a death benefit when the insured person dies.

The premiums are fixed and have to be paid without default.  The policy lasts for the entire lifetime of the individual and when he or she dies, the beneficiaries will receive a fixed amount that is called the death benefit.  During the lifetime of the policyholder, he has the right to borrow against the cash value that has built up.  This amount can be used for any exigencies that arise.  This proves an asset to the insured for the amount can be borrowed without the need to pay taxes. 

Term insurance is taken for a fixed period of time at specified rates. When the period expires, if the policy holder is still alive, then he has the option of renewing the plan but at higher rates. There is no savings component and the beneficiaries simply receive a fixed amount as death benefit. The coverage amount and period can be decided by the applicant.

Now that you know the basics of both these plans, you can make a comparison based on the above factors. As far as the premium amounts are concerned, the cost of term insurance is much less than whole life insurance. Those with limited incomes, have only one member in the family earning or have a large family with a lot of expenses will opt for term insurance over whole insurance.

The greatest benefit of whole insurance over term insurance is the savings component. Those who can afford to invest in this plan and allow the insurance company to take care of their investment options can be assured of a cash value build up that they can borrow from in times of need. However, those who cannot afford it may consider it a forced savings that requires higher premium payments, commission and fees paid to the insurance company.  

Term insurance does not allow beneficiaries to claim the coverage amount if the holder outlives the term.  He has to renew the policy at higher rates.  On the other hand, whole insurance is for the entire lifetime and rates may not vary even if the holder develops a medical condition.  Age and health play an important role in determining rates of both forms of insurance. Young, healthy individuals will attract lesser rates that older people, who suffer from ill health.  The latter category of people, can consider opting for no medical exam term life insurance that will give adequate coverage but at much higher rates.  Once you compare and contrast these two major life insurance categories, you can come to the right decision as to which plan to choose.

Article by David Livingston of EQuote, who is a specialist in everything life insurance. For more information on life assurance and term life insurance, visit his site today.