Income Tax Rates

The following article is about the advantages offered by the Term Life Insurance in comparison with the Whole Life Insurance. There is no need to worry about high priced premiums, by the prospective policy owners. Financial security is available at a comparatively lower price, in the form of Term Life Insurance.

Prospective policy buyers have doubts concerning the sort of Insurance to purchase. Likewise, they remain uncertain for the exact amount of Premium payment and Insurance cover availability. Customers do not have a clear notion regarding different features of policies available in the market.

Owners of Variable Life Insurance earn Tax free income. The interest generated through the investments can also be used for paying premium amount. Earnings may get reduced significantly, due to poor performance of the funds. Thus, to keep the policy in vigor one may have to pay an additional amount for the premium. The amount of death benefit may get reduced due to poor performance of funds but such reduction is quite more than the specific level. During the life span of the policy owner, cash value can not be withdrawn.

In comparison to other policies Variable Life Insurance policies are costly. However they have more control and elasticity attached with them. There is significant potential to receive tax free earnings and grant the Beneficiary with a significant amount of tax free money. As one can save on Estate taxes, policy owners acquire Variable Life Insurance for their heirs who can withdraw from the cash value or borrow against it.

The Term Life Insurance can be limited to a particular period or motive. For example Term Life Insurance can be taken till the time Mortgage loan is returned completely or up to Retirement. The basic rationale of Term Life Insurance lies in providing financial security to the dependants of the policy owner in the unfortunate event of the unexpected death of the policy owner. To serve this purpose, one can choose the requisite amount of Insurance and a Term span up to thirty five years.

The weakness of Variable Life Insurance lies in the risk concerned with the cash value component that is affected mainly by the performance of investments. The Insurance providers hold no responsibility regarding investment decisions taken by the policy owners. In addition, no minimum balance with regards to the policy sum invested is guaranteed by the Insurance provider. In case the investments perform badly in the market then the insurance provider will forfeit the cash value towards the premium payments, though if policy buyers invest wisely, they can make substantial earnings in comparison with other policies.

In the unfortunate event of premature expiry of the policy owner, Term Life Insurance is an ideal arrangement. Though, it is impossible to forecast the life span of an individual. Thus, Term Life Insurance is the most appropriate policy cover which offers the desired financial security to the beneficiary if the policy owner expires unfortunately. Individuals having a family history of sudden premature deaths can get secured by purchasing a Term Life Insurance.