The recent world events might have pushed you to consider taking permanent life insurance. John Ritenour, a veteran insurance sector guru with more than four decades of experience, believes taking life insurance is an excellent move. John is the founder and former CEO of the Insurance Office of America. Recently, he did an interview discussing permanent life insurance options.
What is permanent life insurance?
There exist two primary types of life insurance policies, term insurance, and permanent life insurance. The former is designed to offer life insurance coverage for a limited amount of time, and the latter lasts for all or most of the insured’s life. The former IOA CEO explained that permanent life insurance typically matures once the insured passes on.
- Whole life insurance
John Ritenour explained that whole life insurance would remain in effect to when the insured dies. The insured is expected to pay their premiums until the time of their passing. Moreover, no matter the changes in the economy or life of the insured before their death, the premiums will remain the same, and so will the death payout.
- Universal life insurance
The IOA founder stated that universal life insurance is similar to whole life insurance, but it offers more flexibility and benefits to the insured. If the insured needs quick access to cash, they can withdraw part of their funds as a loan. Additionally, their policy can have a cash value that can earn interest.
- Variable universal and variable life
Variable universal and variable life policies have a cash value that’s connected to investment accounts. Going for these life insurance options means that the insured will earn interest on their investments. John Ritenour clarified that the main difference between the two was that variable life policy has fixed premiums, and the performance of the assets doesn’t affect the value of the death payout. In contrast, variable universal life policy has adjustable premiums.