Navigating the ins and outs of a life insurance policy can be confusing. This world has its own vocabulary, filled with long terms and remarkably similar phrases. Do you know the difference between term life and whole life? Are you familiar with disclosure statements, lapse rates, and free look provisions? When you’re comparing policies, it’s important to understand the options that are available to you. You can’t accurately hold one option up to another if you don’t know that the premium is what you pay for the plan, while the death benefit or policy proceeds go to your beneficiary.
Your life insurance policy is actually a contract that you execute with your insurer. You are the insured policyholder who pays a premium for coverage. Upon your death, the policy then pays your designated beneficiary. You can choose a plan that pays out in fixed installments or in a fixed number of payments. There are even plans that offer life income for your beneficiary. These offer a death benefit plus interest, paid out through a life annuity.
A term life policy is only good for the term determined in the contract. If you outlive the policy, you don’t recoup any benefits. A whole life coverage plan is good for the duration of your life but comes with a much higher premium. If you’re interested in exploring your options, brush up on your knowledge with HealthIQ. Take this helpful vocabulary quiz and learn more about how to read your policy properly.
About Health IQ
Health IQ’s mission is to improve the health of the world by celebrating the health conscious through financial rewards. Health IQ delivers better rates and underwriting, and was recently featured in sites such as CNBC, Venturebeat, and TechCrunch. Health IQ also partners with top-rated insurance carriers such as SBLI, Ameritas Life Insurance Corp. and Assurity Life Insurance Company, and reinsurer partner Swiss Re to offer health conscious people between 4 and 33 percent lower rates on life insurance. Founded in 2013 by a team of health conscious entrepreneurs, the company is a licensed life insurance company in all 50 states and has helped tens of thousands of individuals secure a total of $5.3 billion in insurance coverage.