Before you start
Guide contents
The words first
Six words worth knowing first
Every life insurance policy is described with these. They come up on every page from here on, so two minutes now saves you guessing later.
The six words
Read them once. You do not have to memorize anything.
- PremiumWhat you pay to keep the policy in force, usually every month.
- Death benefitThe amount paid to the people you name, when you die. Also called the face amount.
- BeneficiaryThe person or people who receive it. You choose them, and on most policies you can change them later.
- TermCoverage that lasts a set number of years. You pay little and own nothing at the end.
- Whole lifeCoverage that does not expire. You pay a lot more, and it never runs out.
- Cash valueA balance that builds up inside a permanent policy over the years. Term policies do not have one.
Now the guide.
Six short steps, in the order the questions actually come up.