Life Insurance Contracts and Plans for Every Stage

Life insurance contracts can be tailored to meet the needs of individuals at various stages of their lives. There are different types of life insurance contracts that cater to specific age groups and life situations.

For young adults, term life insurance is often the most affordable option, providing coverage for a set period of 10 to 30 years. This type of policy is ideal for those with dependents or significant debts.

As individuals enter their 40s and 50s, whole life insurance becomes a more popular choice, offering a guaranteed death benefit and a savings component called a cash value. This policy can be a good fit for those who want to build wealth over time.

In addition to these two main types of policies, there are also hybrid options that combine elements of term and whole life insurance.

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Types of life insurance can be overwhelming, but let's break it down. There are several main types, including term, whole, universal, and variable life insurance.

Term life insurance is a temporary policy, typically lasting 10, 20, or 30 years. It doesn't build cash value and has a fixed death benefit. You can choose from renewable term, convertible term, and level or decreasing term policies.

Whole life insurance, on the other hand, lasts your entire life, as long as you keep up with premiums. It builds cash value and has a relatively simple structure compared to other permanent life insurance options.

Universal and variable life insurance are also permanent policies that build cash value and offer flexible death benefits. Burial insurance is another type of permanent policy that covers funeral expenses.

Here's a quick summary of the main types of life insurance:

You may also come across other life insurance options that cater to specific needs, such as term life or permanent life insurance. Permanent life insurance policies can offer coverage for your entire life, but they often come with higher premiums.

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The main difference between term life and permanent life insurance is the duration of coverage. Term life insurance typically lasts for a set period, such as 10 or 20 years, after which it expires.

If you prioritize consistent benefits and premiums, permanent life insurance might be the better choice for you. This type of policy can also offer tax-deferred savings growth through its cash value component.

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Life insurance plans can be customized to fit your needs and budget. There are several types of plans to choose from, including Modified Life Plan, which offers lower premiums in the early years and higher premiums later on.

A Modified Life Plan is designed for those who cannot initially afford the regular whole life premium but who want the higher premium coverage and feel they will eventually be able to pay the higher premium. This plan provides a lower premium for the first few years and a higher premium in later years.

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You can also consider a Family Policy, which provides insurance protection under one contract to all members of your immediate family. Family policies are usually sold in units of protection, such as $5,000 on the main wage earner, $1,500 on the spouse, and $1,000 on each child.

Here are some key features of various life insurance plans:

It's worth considering Joint Life and Survivor Insurance, which provides coverage for two or more persons with the death benefit payable at the death of the last of the insureds. Premiums are significantly lower under joint life and survivor insurance than for policies that insure only one person.

For another approach, see: Life Insurance Policy after Death

Permanent life insurance, often called whole life insurance, provides coverage for the insured person's lifetime as long as premium payments are in good standing. This type of insurance can build cash value, which a policyholder or their heirs can access under certain conditions.

The premiums for whole life insurance can be higher than for term life policies, but it offers a guaranteed rate of return on the policy's cash value and a death benefit amount that doesn't change. Whole life insurance typically lasts your entire life, as long as you keep up with premiums.

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There are various types of permanent life insurance, including traditional whole life, participating whole life, and single premium whole life. Each of these types has its own characteristics and benefits.

Here are some key features of permanent life insurance:

Some of the best whole life insurance companies in 2025 include Guardian, MassMutual, Northwestern Mutual, Thrivent, New York Life, Penn Mutual, and AARP, according to NerdWallet's ratings.

Variable life insurance is a type of permanent coverage that can provide a guaranteed death benefit. This type of policy is best for those with a higher risk tolerance who want greater control over their cash value investments.

Variable life insurance premiums are typically fixed, and the death benefit is guaranteed, regardless of how the market fares. If you're considering a policy like this, a fee-only financial advisor can help you choose the best one.

Some variable life insurance policies offer a hybrid feature known as variable universal life insurance, which allows for adjustable premiums. This may suit those who don't want to commit to paying the same amount in premiums each month.

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Variable life insurance has the potential for considerable gains if your investment choices do well. However, it requires you to be hands-on in managing your policy because the cash value can change daily based on the market.

Here are some key features of variable life insurance:

For variable policies, it's essential to consider the investment objectives, risks, and charges and expenses carefully before investing in the contract, and/or underlying portfolios. You can obtain a copy of the prospectuses and read them carefully before investing.

A modified life plan is similar to whole life, but with a lower premium for the first few years and a higher premium in later years.

This plan is designed for those who can't initially afford the regular whole life premium but want the higher premium coverage and feel they'll eventually be able to pay the higher premium.

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Joint life insurance plans can be a cost-effective option for couples or families, with premiums being significantly lower than policies that insure only one person.

Joint life and survivor insurance provides coverage for two or more persons, with the death benefit payable at the death of the last of the insureds.

Joint life insurance, on the other hand, provides coverage for two or more persons, but the death benefit is payable at the first death, making premiums significantly higher.

This type of insurance is often sold in units or packages, such as $5,000 on the main wage earner, $1,500 on the spouse, and $1,000 on each child, as part of a family policy.

Joint life insurance plans can be a good option for families who want to ensure that their loved ones are protected, regardless of who passes away first.

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Simplified issue life insurance policies don't require a medical exam, but you may be asked a few health questions and could be turned down based on your answers.

These policies use quick, online health questionnaires as well as algorithms and big data to speed up the application process.

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Simplified issue policies can be a good option for people who want to avoid the hassle of a medical exam, but keep in mind that you may still be asked some health questions.

You can apply for simplified issue life insurance online, making it a convenient option for those with busy schedules.

This type of policy is not necessarily cheaper than a fully underwritten policy, so be sure to compare rates before making a decision.

Related reading: Simplified Whole Life Insurance

Life insurance coverage can be a crucial aspect of securing your loved ones' financial future. Term life policies are often the simplest and most straightforward option, providing a death benefit to replace income or pay off debts.

A term life policy may be right for you if you have minor dependents who will grow up and become financially independent within a set period. This type of policy can also help pay off a mortgage or other large debts.

There are different types of term life, including level term and decreasing term. Level term life insurance offers a death benefit that stays the same throughout the policy.Decreasing term life insurance reduces potential death benefits over the policy's term, usually in one-year increments.

Term insurance rates are competitive and among the lowest historically experienced. However, premiums do rise with age, so it's essential to review your policy terms carefully to ensure you're getting the best coverage for your needs.

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Term insurance provides protection for a specified period of time, which can be as short as one year or up to a specified age. This type of insurance is often chosen for temporary needs, such as paying off a mortgage or providing income replacement for a dependent child.

If you die during the term period, the company will pay the face amount of the policy to your beneficiary. You can also choose a term plan that allows you to pay premiums for a longer period, but this will increase your initial premium.

Term policies offer a death benefit with no savings element or cash value, which means your premiums go towards your payout. This makes costs for policyholders comparatively lower than for permanent life insurance.

Term life policies can be level, providing the same benefit until the policy expires, or decreasing, with the potential death benefits reducing over the policy's term. Some insurers have created term life products with a "return of premium" feature, returning a portion of the premiums you pay if a claim is not filed before the end of the coverage term.

There are different types of term life, including:

Burial insurance, also known as final expense insurance, is a small whole life insurance policy designed to help your family cover funeral, burial, and other end-of-life expenses. The death benefit is guaranteed and typically ranges from $5,000 to $25,000.

A medical exam isn't typically required, making it more accessible to seniors with pre-existing health conditions. This is a big plus for those who may have health issues.

Coverage is capped at low amounts, so if you die within two or three years of taking out your policy, your insurer may not pay the full death benefit. This is something to keep in mind when choosing a policy.

State Farm, AARP/New York Life, American Family, Ethos, and Mutual of Omaha are some of the best burial insurance companies in 2025, according to our research. These insurers have a strong reputation and offer reliable coverage.

Here are the details on each of these insurers:

Choosing a Life Insurance Policy can be a daunting task, but understanding the basics can make it more manageable.

Term life insurance is often a more affordable option, with premiums that are typically lower than those of permanent life insurance policies. If you're looking for temporary coverage, term life insurance is available.

Permanent life insurance, on the other hand, offers coverage for your entire lifetime, but can charge higher premiums. This type of insurance is ideal for those who prioritize consistent benefits and premiums.

If you're unsure which type of life insurance is right for you, consider using a tool to help you figure it out. This can be especially helpful if you're not sure if you even need life insurance.

Let's take a look at some of the key features of different types of life insurance policies. Here's a breakdown of the types of policies:

When it comes to term insurance, there are several types to consider. Renewable term policies give you the right to renew for another period when a term ends, regardless of your health. Convertible term policies permit you to exchange the policy for a permanent plan. Level or decreasing term policies have a face amount that remains the same or reduces over time, respectively. Adjustable premium insurance allows insurers to offer insurance at lower premiums based on less conservative assumptions, but the premium can never be more than the maximum guaranteed premiums stated in the policy.

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Life insurance underwriting refers to how a life insurance company calculates the risks of insuring you. This process determines the policy's underwriting, which affects how quickly your coverage will go into force, whether you'll need to take a medical exam, and the price you'll pay.

There are three main types of life insurance underwriting. A fully underwritten policy is generally the cheapest option for healthy individuals.

The application process for fully underwritten policies typically includes a medical exam and questions about your health, family's health history, hobbies, and travel plans. Insurers use this data to price the policy more accurately based on your specific life expectancy.

For your interest: Medical Underwriting

Let's start with the basics of life insurance. A term life policy is purchased to last for a specified period, such as 1, 5, 10, or sometimes as much as 30 years.

Coverage with a term life policy expires when that period ends, which is why it's called term life insurance.

If you're looking for long-term coverage, you might want to consider other options. Term life policies only provide a payout if the insured's death occurs during the specified period.

If you outlive the original policy period, you may have the option to renew your coverage, but be prepared for potentially higher premiums.

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Life insurance policy management is crucial to ensure your loved ones are taken care of in the event of your passing. You can manage your policy by making changes to your coverage, such as increasing or decreasing the death benefit or adding riders.

To make changes to your policy, you'll need to contact your insurance provider, who will guide you through the process. This can typically be done over the phone or through your online account.

Regularly reviewing and updating your policy can help ensure it continues to meet your needs and provide adequate coverage for your loved ones.

Life insurance policies come in various types, each with its own unique characteristics. Understanding these differences is crucial in making informed decisions about your coverage.

Term life insurance provides temporary coverage, while permanent coverage is offered by other types of policies. Temporary coverage is not available for term life insurance, but it is a feature of universal life insurance.

Permanent coverage is a key benefit of universal life insurance, as well as indexed universal life insurance, indexed variable universal life insurance, and variable universal life insurance. These policies can provide a guaranteed death benefit, which is a critical aspect of life insurance.

Universal life insurance and its variants focus on building cash value, which can be used to supplement the policy's death benefit. However, this cash value is usually restricted as a living benefit and remains with the insurance company when the insured dies.

Here are some key features of different types of life insurance policies:

This table highlights the key differences between various types of life insurance policies. By understanding these differences, you can make informed decisions about your coverage and ensure that you have the right policy for your needs.

Monthly Debit Ordinary insurance can be a costly option due to certain factors. These factors include expenses that remain the same regardless of policy size, resulting in higher premiums per $1,000 of insurance for smaller policies.

Higher lapse rates among debit policyholders can also increase costs, as companies must pass these expenses on to all policyholders. This is often the case because more debit policyholders allow their policies to lapse compared to regular life insurance policyholders.

Debit insurance typically involves higher commissions and fees, which are often passed on to the policyholder. This is because debit insurance is designed to include home collections, and these higher expenses are factored into the premium.

Smaller policy sizes, higher lapse rates, and higher commissions and fees all contribute to debit insurance being more expensive than comparable regular life insurance plans. This is a general rule that applies to most companies offering debit insurance.

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Consider the following comparison of debit and regular insurance premiums:

If you're considering debit insurance, it's essential to investigate regular life insurance as a cost-saving alternative. This might allow you to purchase a larger amount of regular insurance at no extra cost.