It’s important to know that in the event of one’s death, his or her family will be taken care of financially. Life insurance policies which provide coverage for funeral expenses and secure their dependents with an ongoing benefit to cover living expenses. Not every policy is the same however, so when shopping for life insurance Chicago customers need to carefully choose the one which best matches their needs.

Benefits packages provided by many employers often include some life coverage, although the insured generally has little control over the amount of benefits and other details of these policies, and if the employment ends, so does the insurance. One must still take this into account when determining how much and which type of plan to purchase.

The four main types of life policies are term, whole, universal, and variable. Term coverage has a specified period within which the recipients will receive benefits if the insured dies. Upon expiration, it can be renewed, but usually for a higher premium because the policy-holder will be older. This is the most popular type of policy, because it has a choice of terms, is tax-free, and provides good coverage for the price paid.

A whole life insurance policy generally attracts a higher premium, and commissions paid to one’s agent. It has no expiry and instead of providing a death benefit alone, it also builds a savings fund that will gradually accumulate interest and is only taxable when withdrawn. This is a good option for those who plan on keeping it permanently or for a long time, otherwise they may end up losing money.

A universal policy gives the insured a fair amount of flexibility in terms of how much benefits are paid, and the amount and frequency of the premiums. The money is paid into an investment fund from which administrative costs and the death benefits are taken. This fund is subject to gaining interest according to current market rates, which can have either a positive or negative effect on its value.

A variable life insurance policy invests the premium into assets such as stocks or bonds of the policy-holder’s choosing. The performance of these investments during the length of the policy will ultimately determine which amount of death benefits are available to the beneficiaries of the insured. It is also possible to cash it in for the taxable cash value, but there is no guaranteed minimum, and it can drop to zero.

Although there are several avenues one can take for purchasing life coverage, most people prefer to do so through a reliable agent who represents a company with a strong reputation. A professional agent must possess a state license to sell insurance, and he or she should always be happy to answer the customer’s question, never pressure them into anything, and will clearly explain how the policy works to them.

Applicants will need to fill out a questionnaire and may be required to get a physical as well. They must be truthful in their answers and disclose all relevant information pertaining to their health. The company will review the application and decide if they will offer coverage to the applicant, and if yes, what premium amount will be paid.

Read more about Guide To Purchasing Life Insurance Chicago Customers Will Find Helpful.