How Does Term Life Insurance Work?

[nembra]

WRONG! I DON'T KNOW WHERE YOU CUT AND PASTED THAT FROM, BUT IT IS WRONG! Although it is a contract between the polcy holder and tyhe insurer the agreement is to pay a stipulated sum of money called the face value, not an accumulated sum, to the beneficiaries of the policyholder upon demise (death), not illness. The policy holder has to pay the insurer a pre-determined amount called the premium over the term of the plocy, i.e., a set number of years.

+

Absolutely right...i attribute the mistakes made to the perils of multitasking :(. Thanks for pointing it out.

 

[arnguy]

Please don't post crap. Make certain that what you post is not misleading or refrain from posting it. Posting an opinion is different----one may have a wrong opinion.

 

[Norwayguy]

Please don't post crap. Make certain that what you post is not misleading or refrain from posting it. Posting an opinion is different----one may have a wrong opinion.

In my opinion the above post is correct.




Gee is that a correct or wrong opinion?

 

[HallLifeIns]

When meeting with clients and they wonder what the difference is between Term and Whole Life/Universal Life, I explain it first this way and then get into the mechanics of it. Term is like renting a house. You have the coverage as long as you pay the premium. You can live in the house as long as you pay the rent. Whole Life and Universal Life is like buying a house. With each payment on the home, you have equity building up and over the years, that can accumulate to a large sum. The same is true with Whole Life or Universal Life insurance. You have Cash Value build up within the policy which is like equity in a home. You may borrow on it or it is yours if you decide to cash the policy in. However, upon death, you don't receive both the Cash Value and the Face Amount of the policy. You get only the Face Amount as a death benefit.

This brief explanation helps them understand the concept of each type of policy.

 

[arnguy]

It is a correct opinion in the case of nrmbra, Peter. Apparently he has been eradicated from this thread, but I think i saw him pop up elsewhere with his profound judgments.