Cheap Whole Life Insurance New Mexico
Reader’s Question:
Are there many types of whole life insurance policy? What is the cheapest policy among its types, if any? I live in New Mexico.
Amy
Santa Fe, NM
Hello there Amy!
Certainly, there are many types of whole life insurance policy in New Mexico, but there might be gray area as to which one is the cheapest whole life because of the varied features.Most common among the varied types of whole life policies are traditional, limited payment, interest sensitive, and single premium life insurance. Other variations of this type include more complex features such as joint life and family plans.
With traditional policy, you are given a guaranteed minimum rate of return on your cash value portion in the form of dividends. Normally, the life policy premiums must be paid until the insured reaches age hundred and then the cash value will equal the death benefit.
In limited pay whole life policies, the premium paying period is compressed and you pay larger premiums for the same amount of whole life insurance in a shorter duration of time. You only pay premiums that cover you for your lifetime within duration of time that you choose. Normally, for limited pay whole life policy, it is normally stipulated that premium payment period must last at least 10 years and premiums must be wrapped up by the age of 65.
There’s another type of whole life insurance policy called interest sensitive which are level premium that don’t pay dividends, but the cash value grows. There is more flexibility with this policy.
Another choice is a single premium whole life insurance which lets you pay the whole policy amount up front. Since premium is paid one time, this is normal for someone with very good financial status. This type also offers cash value.Other types include universal and variable whole life policies.
You see, for anyone looking for money’s worth, it’s not really which one is cheapest whole life insurance policy to look for since each type has different features and terms of payments. What’s a more apt consideration to take are the respective benefits of each and your lifestyle and future requirements.
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