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In preparation to apply for purchaseAmerican Life InsuranceAt the time, we often encounter this question: which is better, term life insurance or whole life insurance?why?Today we will shareTips for buying life insurance in the U.S.: Regarding the discussion about term life insurance and whole life insurance which is good, give an independent point of view.Before we start, we simplyTerm life insurance和Lifetime insuranceMake a simple comparison.
Comparison of term life insurance and whole life insurance
In terms of product design, the protection functions of life insurance are very simple, namely:When the insured's labor force (including but not limited to death, disability, or terminal illness, etc.) is lost, the insurer pays the insurance money.
From the point of view of the policyholder, it can be understood as: life insurance isLoss of the insured’s labor force (including but not limited to death, disability or terminal illness, etc.)As a prerequisite, the amount of insured shall be paid to prevent him/her from having a devastating impact on the family or the economy of the dependents after his/her death or loss of labor.
So in a word, life insurance is naturally to giveFamily's financial pillarprepare.
The difference between term life insurance and whole life insurance
(1) The difference in guarantee time
Term life insurance, As the name suggests, provides coverage for a specific period of time, usually 10 years, 20 years, or until the insured reaches the specified age.
Whole life insurance, Provide life-long compensation protection for the insured.The insurance period generally ends when the insured reaches 100 years of age. When the insured reaches 100 years of age, the insurance company pays the insured a sum of insurance money.
(2) Cash value
Term life insurance has no "cash value" function and is usually regarded as"Insurance" with pure protection without investment function.For example, if you are insured until the age of 60, if you are still healthy by then, the premiums of the past few decades are equivalent to being consumed.No cash value.
Whole life insurance, No matter when the insuredDeath or eligible for compensation, Insurance companies are required to pay claims.Moreover, whole life insurance types can put extra money into the policy, which is equivalent to savings and has cash value.
(3) Product price
In terms of claims, if you buy whole life insurance, you will eventually get the amount of insurance no matter what.When the term life insurance expires, it becomes invalid.
Therefore, in terms of product prices, whole life insurance is much more expensive than term life insurance.
Which is better, term life insurance or whole life insurance?
Through the above introduction and comparison, we can see that term life insurance is pure "保险. "
But whole life insurance, in addition to "insurance", is also a "金融"Tools. This is also the United Stateslife insuranceInsurance policies are regarded as financial products by the government and are included in strict financial supervision.And some of the policyholders see it as a "financial" tool.
Therefore, "insurance" and "financial" tools, bothNot comparable at all.
If you have to give this question, the simplest answer is:Life insurance is good.
The premise of this answer is that you are not short of money and want long-term protection.
If youSmall budget, And carrying mortgages or other loans, there are spouses and children to support at home, work risk is very high, so term life insurance is better.
The reason is:Cheap.Compared with the premium of whole life insurance, the same sum assured is almost 1/10 to 1/8.
Why is whole life insurance good?
Zhisuo answered that life insurance is good, based on the social development and the expectation that your life will be better.
It is true that term life insurance is cheap, but once term life insurance expires, at least 10 years and 20 years have passed, and if you want to buy a term life insurance, the premium will soar like a rocket.The only advantage of term life insurance:The price is cheap, it’s gone.At that time, I went to buy whole life insurance because my age is much older than now. For insurance companies, the risk is much greater, and the premium will rise accordingly.
Therefore, from a long-term perspective, buy whole life insurance when you are young in advance, enjoy the relatively low premiums corresponding to your health when you are young, and wait for the cash value in the whole life insurance to have enough time to accumulate compound interest to offset the old age. Timely annual premiums to complete a healthy policy financial internal cycle.
以American Life InsuranceAn example of the policy planning plan of two editors of Guide.com, one bought it at the age of 22IUL Index Insurance, A person who bought savings-type whole life insurance at the age of 33.
The former pays 400 yuan a month, and the insured amount is 100 million. When he retires at the age of 65, this IUL whole life insurance policy can provide the editor with a tax-free annual pension of 6.The 33-year-old editor, 400 yuan a month, with an insurance coverage of less than 30, pays for 20 years, and when he is 65 years old, he can receive a tax-free pension of more than 3 yuan a year.
This is the age of insurance and the power of "financial" leverage of different types of insurance.
(Edited excerpts from the content of this article are excerpts from today's headline Q&A column in the American Life Insurance Guide)
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