Life insurance is a contract between a policyholder (you) and an insurance company. You agree to pay for an insurance policy regularly and the insurer agrees to pay a sum of money to your designated beneficiaries if you die during the term of the contract. Premiums may be paid monthly, semi-annually, or annually for the term of the policy.
Like automobile insurance, life insurance can be simple or very complex. It depends on the choices you make when choosing among the policies on the market and the options available to you. The term of this insurance can be as short as a year or as long as a lifetime.
How do I buy American life insurance?
In the United States, there are three ways to buy life insurance: directly from an insurance company, through an independent local insurance agent, or through an independent online broker. Many people also buy life insurance through their business when it has agreements with certain companies or brokers. In 2016, there were nearly 800 insurers in the United States specializing in life insurance contracts.
Which life insurance to choose?
The choice of life insurance is made according to your personal situation, i.e. according to your needs, your age, your assets, your objectives, etc. In the United States, there are five main types of life insurance contracts.
The “Term Life Insurance” contract covers the policyholder for a fixed number of years (from 1 to 30 years). The premiums are fixed and the coverage is defined in advance. There is no notion of savings (or “cash value”) as in other contracts, and in this case, there is no remuneration on the premiums paid. Term Life Insurance” is “pure” insurance products. Premiums are lower than in other contracts. Attention, the amount of the premium is only fixed for the duration of the contract. If the policy expires and you want to renew it, you will pay a higher premium because you are older at the time of renewal and maybe in poorer health.
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