Life insurance USA

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In the United States market there are two basic types of life insurance: term life insurance and permanent life insurance (the latter is divided into several categories, which would be insurance). of traditional permanent life (traditional whole life), variable life insurance (variable whole life) and universal life insurance.
Types of life insurance USA
Term life insurance
​This type of insurance is the simplest of life insurance. The policy makes a payment when the insured person dies during the time or term of validity of the policy, which can range from 1 to 30 years. Most term insurance does not include other payment provisions.
There are two different ways to purchase term life insurance: level term life insurance and decreasing term insurance.
​Level term life insurance: 
Means that death benefits remain the same during the term of the policy.

 
​Declining term life insurance: 
Implies that death benefits vary and decrease with the passing of the policy years, usually at one year intervals until the end of the policy.
The permanent life insurance​

Permanent life insurance pays benefits in the event of death, no matter how old the insured person lives, even if he or she lives to live 100 years. There are three basic types of this insurance and each of them has its variations.

Traditional permanent life insurance: It is the most common permanent insurance. The owner of the policy chooses the amount of coverage, which may be the amount of thousands of dollars that it determines; for example, 100 thousand dollars and agrees with the insurer that it will pay a specific premium to the year (or to the month, or every six months) from the first year of validity of the insurance and thus indefinitely. The savings element will grow in the account under the conditions determined by the insurer. These savings will not be paid to the beneficiaries, only the value of the policy (100 thousand dollars) in case of death; but if the insured decides to suspend or change the insurance, the accumulated value in the savings account may be recovered, after paying service charges and for the elimination of the policy.
Universal life insurance: In general, in this type of insurance, the portion of money left over from the life insurance amount is placed in an interest or investment generating account, depending on the options offered by the insurer and the type of insurance. insured's investment. Those who choose this type of insurance could use the savings portion to add more money to said investments or to reduce the amount of the premiums to be canceled. In case of a need, they can temporarily reduce the amount of the monthly premium and the insurer will take from the money accumulated in the investment account to pay the difference in the price of the premium.
This particularity can become a great advantage in the event that family financial conditions change suddenly (such as leaving you out of work for a while) and you can not make premium payments or have to reduce them. But it can also be a risk, since it can happen that in the time that the accumulated money is being used, the funds accumulated in the investment are finished and they do not have the money to continue paying the policy, due to lack of payment.

Variable life insurance: It is a little more flexible with respect to the investments that the insurer uses to generate the income in the insured's account, since it usually makes them in equities, that is, in stock instruments such as bonds, stocks and / or Mutual funds. This strategy is, of course, long-term given the ups and downs of stock investments.
In this type of insurance the amount of the benefit of the policy is often defined by the result that generates the investments with a minimum to be paid. For example, the benefits of your insurance will be generated from what you earn during your investment and guarantee that it will be at least a specific amount in thousands of dollars. If the investments are more than that amount, their beneficiaries will receive what is generated from the investments; if it is less, they will receive the minimum guaranteed.
Universal-variable life insurance: Finally there is a type of policy that is the combination of the two previous ones: a universal-variable life insurance policy. With this type of insurance you can combine the characteristics of variable insurance, which invests in the stock market and could generate high returns for your long-term beneficiaries (and often with a guaranteed minimum amount), with the ability to adjust the amount of premiums that you pay, increasing it if you want each month or year to contribute more to your investment account or reduce the premiums in case of economic need.

The important thing about each of these insurance styles is that you are convinced that the chosen one is appropriate for your family situation, for your investment inclinations and for your economic reality; but above all that your family does not have a wrong concept of the protection it has, to avoid surprises and shocks after your departure.

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