1. What is term life insurance?
Answer: Term life insurance is a type of life insurance that provides coverage for a specific period of time, such as 10, 20, or 30 years. If the policyholder dies during the term of the policy, the beneficiaries will receive the death benefit.
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2. What is whole life insurance?
Answer: Whole life insurance, also known as permanent life insurance, provides coverage for the entire lifetime of the policyholder. The policy also includes a savings component, known as the cash value, which can be borrowed against or used to pay premiums.
3. What is the difference between term life insurance and whole life insurance?
Answer: The main difference between term life insurance and whole life insurance is that term life insurance provides coverage for a specific period of time, while whole life insurance provides coverage for the entire lifetime of the policyholder.
4. How do I determine how much life insurance I need?
Answer: The amount of life insurance you need will depend on your personal circumstances, such as your income, debts, and the number of dependents you have. A general rule of thumb is to have enough coverage to replace your income for a certain number of years, or to pay off outstanding debts and expenses.
5. Can I cancel my life insurance policy?
Answer: Yes, you can cancel your life insurance policy. However, it’s important to note that if you cancel a permanent life insurance policy, you will lose the cash value accumulated in the policy.
6. Can I change the beneficiaries on my life insurance policy?
Answer: Yes, you can change the beneficiaries on your life insurance policy at any time by contacting your insurance company.
7. What happens to my life insurance policy if I retire or lose my job?
Answer: If you retire or lose your job, your employer-provided life insurance policy may be terminated. It’s important to check the terms of your policy to see what happens in this situation, and consider purchasing an individual life insurance policy.
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