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What is LIFE INSURANCE? | Life Insurance Explainer Video - YouTube
Channel: Lecture Pal
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meet ava
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ava has been through an incident that
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made her think about purchasing a life
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insurance policy
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but wait
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she knows nothing about life insurance
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let alone what type could be the most
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suitable option stick around till the
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end of this video if you are like ava
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would like to know more about what life
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insurance is and what types of life
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insurance are offered in the us
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so let's start with the basics shall we
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life insurance is a contract between an
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insurer and a policy owner
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during the lifetime of the policyholder
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they pay for premiums in exchange for
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their beneficiaries to receive a
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specific sum of money known as the death
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benefit after they pass away
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beneficiaries are most commonly the
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family of the policy holder
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a beneficiary can also be a company
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the policy holder needs to be sincere
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about their past and current health
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conditions
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or they may risk breaching the contract
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with the insurance company and the
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beneficiaries losing the right to the
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death benefit
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other activities that are considered
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high risk should also be disclosed
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while i have your attention do you mind
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hitting that subscribe button and bell
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button to join our notification squad
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thanks
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now let's take a quick look at different
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types of life insurance policies
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there is a variety of options out there
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depending on the different needs or even
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preferences of the policyholder
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the biggest choice you need to consider
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is whether you are interested in
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temporary or permanent life insurance
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term life lasts for a certain number of
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years while permanent life insurance
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covers the entire lifespan of the
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policyholder in term life you can choose
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between 10 20 or 30 years of coverage
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it's an affordable option and that's why
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people like term life insurance
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on the other hand permanent life
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insurance covers the insured person's
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entire life
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that's assuming that the person does not
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stop paying the premiums or surrender
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the policy
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there are many options you can choose
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from in both types of life insurance
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term life can be either decreasing
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convertible or renewable decreasing term
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life insurance offers decreasing
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coverage over the life of the policy at
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a predetermined rate
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convertible term life insurance provides
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the option to convert a term policy to
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permanent insurance
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renewable term life insurance is renewed
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yearly and provides a quote for the year
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the policy is purchased
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the premiums increase annually this
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option starts as the cheapest option but
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increases over time
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now let's look at the types of permanent
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life insurance you can choose between
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whole life universal life indexed life
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and variable universal life insurance
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whole life insurance allows you to
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accumulate cash value
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this cash value can be used for many
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purposes including loans a source of
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cash or even to pay the policies
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premiums
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similarly the universal life has a cash
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value but this cash value also earns
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interest over time
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flexible premiums that can be adjusted
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over time are also an extra perk for
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universal life insurance
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indexed universal life insurance takes a
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similar approach by letting the
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policyholder earn a fixed or equity
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indexed rate of return based on the cash
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value component
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finally the variable universal life
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insurance allows the policyholder to
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invest the policies cash value in an
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available separate account
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variable universal life insurance also
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has flexible premiums like universal
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life insurance
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so it's clear that you have a lot of
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homework to do before making up your
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mind
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make sure to tune into our channel to
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learn more about life insurance as we
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will continuously upload videos that
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will help you in this life altering
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decision
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if you like this video make sure you
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demolish that subscribe button and join
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our notification squad by hitting the
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bell button
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