Life insurance is a guarantee so that we can face some complicated circumstances with the greatest peace of mind and support possible. They are designed to cover unforeseen events that may arise related to the illness, disability or death of a person.
The life insurance contract establishes that you will have to pay an amount of money periodically (premium) for the duration of the contract. In exchange for your payments, the insurance company will have to pay, when you die, a certain amount of money (compensation) to one or more people chosen by you (beneficiary).
Why I have to buy life insurance in USA?
Life insurance can help provide financial security for your loved ones in the event of your death. It can be used to cover funeral expenses, settle debts or even continue the financial support of the household.
Types of life insurance
There are two basic types of life insurance in the US market: term life insurance and whole life insurance. The latter is in turn divided into several categories, which would be traditional whole life insurance, variable whole life insurance and universal life insurance.
Terms of life insurance
Term life insurance works in the following way: the policies have a fixed and limited duration at the end of which the coverage ends. Beneficiaries only receive the benefit of the policy if the person dies during the time the coverage was in effect. Within these insurance policies there are one-year coverage, while others offer coverage for longer terms, 20 or 30 years, for example.
Permanent life insurance in the USA
Permanent life insurance covers the person throughout his life, permanently, as long as the premiums are paid without interruption.
The coverage of this insurance, that is, the amount of benefits payable after the death of the insured, and the price or amount of the monthly premium remain level, that is, it will not change during the period that the policy is in force.
Advantages of life insurance in United States
· Covers rising funeral costs
· Replace lost income or value of your time ( eg , stay-at-home partner)
· Pay debts
· Provides for a college education
· Leave an inheritance
