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Life Insurance Basic Terms


  • It is easy to understand the term life insurance. It provides insurance protection for a specific period of time. If you die within the time the policy is in force, your beneficiaries receive the face amount of the policy tax-free. If you outlive your policy term, the insurance terminates and you must buy another policy if you still want to carry life insurance. You can also buy term life insurance that covers you until you reach a certain age, usually 65 or 70.
    Some life insurance basic terms that will help you understand the procedure better are:
    Insured – is the person whose life the insurance policy covers.
    Face amount – is the amount of money that will be paid upon the death of the Insured.
    Beneficiary – is the person designated to receive the proceeds of the life insurance upon the death of the Insured.
    Term Life Insurance – is life insurance that only lasts for a specific period of term, whether it is one, five or ten years, the length of the mortgage. This type of life insurance has a definite ending date.
    Whole Life Insurance – is life insurance that will last as long as the insured person is alive.
    Before accepting the coverage most insurance companies will review your current health condition and heath history. The examination covers your height, weight, blood pressure, blood and urine testing. It is necessary to point out that if the test shows the presence of nicotine you will pay more for life insurance.
    If you have problems with understanding of life insurance basic terms you may consult with your life insurance agent, who will help you to choose the life insurance policy that meets your needs. 

    Life Insurance Basic Terms