FindQuotesInsurance.com

Term Life Insurance - A Perspective

Car Insurance Home Insurance Health Insurance Life Insurance Select State Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming

Let's take an example of a thirty-year-old man who has $100 per month to spend on life insurance. He checks out a number of leading insurance providers and finds a number of products that come with promises on the investment component in cash value. With $100 he may be able to secure a life policy with a coverage of $125,000. This same person may alternatively take a 20-year Term Life Policy that protect him with a cover of $125,000 at $7 a month. This gives him a saving of $93 each month!!

That is a huge saving! If he goes with the Permanent Life cover, the remaining $93 each month should be in good yielding investments with great returns. That is the theory. When one factors in the cost of managing the investment, the returns are much less! The fact is that the return averaged of 2.6% per annum for Whole Life Policy, 4.2 % for Universal Permanent Life Policy and 7.4 percent for Variable Life Policy.

Looking from this perspective, you will probably subscribe to the view that you are better off getting a $7 per month cover for $125,000 and put $93 savings as in a cookie jar! After 3 years, you would have at least $3000 definite savings. Your loved ones would collect the $125,000 death cover and the savings from the cookie jar as well!

Is that a fair view? It is a question of your perspective, your sense of what is value, your faith in your Financial Adviser or your Insurance Agent. At end of it all, it is a issue of what gives you a sense of security. Insurance after all is NOT truly an investment. It is more an expense. What we want out of a protection is a reasonable cost for an equitable cover. Every thing else is veneer!