Question

What is decreasing-term insurance? Why would someone purchase this type of life insurance?

What is group term insurance? How do the premiums on group-term compare to premiums on individually purchased term insurance?

What is whole life insurance? What benefit does it provide that term life insurance does not?

Answer 1

1) Decreasing term life insurance is a type of life insurance policy that's paid over a fixed period of time. Decreasing term insurance is a more affordable option than whole life or universal life insurance because it allows a pure death benefit with no cash accumulation. As such, this insurance option has modest premiums for comparable benefit amounts to either a permanent or temporary life insurance.

2) Group term life insurance is a type of term insurance whereby the insurer issues the employer a master contract with coverage extended to employees. Group term life insurance is relatively inexpensive compared to individual life insurance. As a result, participation is high.

3) Whole life insurance is a life insurance policy which is guaranteed to remain in force for the insured's entire lifetime, provided required premiums are paid, or to the maturity date. It’s benefit is that it provides insurance for whole life.