Traditional fixed life insurance, also known as interest sensitive life insurance, is a type of universal ife insurance. Universal life insurance is a newer type of life insurance where there is greater flexibility in paying premiums and promises a great cash return or value. It is like permanent life insurance in that it provides life insurance coverage for the entire life of the policy holder but also promises a bigger return should the policy holder reach the age of endowment.
Universal policies like traditional fixed insurance are frequently purchased as investment opportunities since the policy does grow in cash value over time. This is another way to provided security for the future.
Benefits of Traditional Fixed Life Insurance
One of the biggest benefits of traditional fixed life insurance is that it is a form of permanent life insurance. This means that you will pay a fixed amount for a fixed time period, anywhere from 10-30 years or until age 65. With a traditional fixed the interest and premiums are calculated at the beginning of the policy so that the premium rate remains the same throughout the payment period.
Who Is Eligible
Anyone is eligible to purchase this type of life insurance. It is ideal for just about everyone. If you are 65 or over you might get more benefit out of a term life policy because you wouldn’t have to pay beyond the life of the term. Many employers offer this type of life insurance to their employees at no cost or for a small fee as part of a benefits package.
This type of insurance can also be purchased for dependants/children as an investment for when they’re older. The days of viewing life insurance for children as a gruesome venture are long gone. Now, many parents and grandparents are purchasing these policies for their children and grandchildren as an investment into their future.