Equote - David Livingston

Universal life insurance is also referred to as flexible premium adjustable life insurance.  This policy protects the well being of your family by having both a death benefit and a good savings plan.  Since the term used is universal the policy covers almost all people and does not have a fixed term like a term life insurance does.  It continues from the time a person applies for it until his or her death, as long as the holder pays his premiums regularly without defaulting.

To be frank, a cash value policy such as a universal life insurance can offer investment opportunity only because such a policy is priced at a higher rate. The premium under such policy is divided into three parts. One goes to meet the administrative cost, another to develop the death benefit and the third part is deposited in a cash value account. This amount is then invested in different sectors and interest is credited to it; sometimes such interest is determined by the insurer and sometimes it is pegged to different financial indexes.

Since the premiums are flexible, you can monitor your payments and add more amount at later stages to increase the coverage your family will receive in the future.  The main disadvantage of universal life insurance is that you need to pay premiums throughout your life, which can become difficult once you retire.  The returns on investment will vary depending on where the insurance company invests your money.  The cost of terminating universal life insurance early can be very high.
 
Since the policy is overpriced, many policyholders find maintaining the coverage throughout their life rather difficult. Moreover, the return often varies with the market condition and therefore it cannot be relied on. Thirdly, premature withdrawal of the policy may actually cost you a lot. That is why people today opt for term life insurance policies. These pure life insurance policies are cheap because you are required to pay only for the cost of insurance. You can now, invest separately in your chosen schemes and have full control over your investments. That is why one should first receive life insurance quote on line, compare the overall cost of each policy and then take proper decision.   

Indeed, today, the popularity of the term life is growing among discerning buyers because it allows them to keep their insurance and investment separate. Since these are pure death benefit and do not require any diversion of funds, you can use such policies to cover all your financial responsibilities such as dependent care, children's education cost, mortgages, loans, final expenses etc. at a very low rate.  Moreover, these policies are valid for a limited period and so you can buy the policy to cover you vulnerable years only. This also is a reason why the policy is so cheap.

The following are the different types of instant term life insurance:
    Level term
    Decreasing term
    Annual renewable term
    Convertible term
In level term life insurance, the death benefit amount remains the same throughout the policy period. Therefore, the premium amounts that are paid will also remain the same.  This makes it easy for the policyholder to calculate exactly how much he needs to pay for the whole duration and work out easily whether he can afford it.

In decreasing term, the coverage amount keeps on decreasing while the premium remains constant. However because the face value decreases over time, such policies are cheaper than traditional policies. You can buy such a policy to cover your loans and mortgages, but take care to calculate the term correctly. Convertible policies leaves you with the option to convert your term life into a whole life if you so desire without having to provide any proof of insurability.

Annual renewable is the most popular since this policy can be renewed each year and the insured does not lose his previous premium amounts.  What is more, he does not have to undergo medical tests each time to prove he is healthy.  In convertible term life insurance, a person can covert to a permanent life insurance when the current term expires.  After a certain age, a person will have to undergo medical tests again since he is older and this could result in increased premium costs.  If you want the cheapest term life insurance, then take one when you are young and in good health and take it for a long period of 20 years or more.  You can get more information on these different types of policies by requesting instant term life insurance quotes online.  Then compare the various rates and decide which type of term life insurance will provide maximum financial benefits for your family.

Article by David Livingston of EQuote, who is a specialist in everything life insurance. For more information on affordable term life insurance and life insurance no medical, visit his site today.