Life insurance are broadly in two categories: Pure protection & protection+investments. Best life insurance.
Pure protection plans known as term plans provides cover for a term/period. This is the best insurance cover because purpose of insurance is to provide protection in case of exigency and this plan provides maximum cover for the term selected.
Other insurance plans like ULIPs, endowment plans or any financial product that combines investment and protection is convoluted and does a disservice to the consumer.
If purpose is to provide cover for your dependents - you should provide maximum cover as per your eligibility.
Term insurance basically provides cover for your income - in simple terms replacement of your income in your absence. Therefore one must first take term cover.
Mutual fund, direct equity, real estate and gold are far superior option than insurance policy that combines protection & investment.
Term life insurance rates for seniors
These days, people are buying and upgrading to living life insurances compared to death insurances. This allows the policy holder to replace their income in an event of critical illness and injury, chronic, and terminal illness, if they were to occur at all. These riders are often offered for no additional cost by strong companies such as National Life group, Life of the Southwest, American General, American National, etc.
On the other hand, the policy holder may not get ill, but end up living too long. Life of the Southwest and National Life Group offer indexed growth on their permanent policy called the Indexed Universal Life (IUL), averaging about 6%-9% growth with 0% floor and 12% cap (the cap is subject to change at the time of application). This allows the policy holder to trigger lifetime tax-free (see: IRC 7702) income at retirement age. Usually the policy holder can stop paying the premium at age 65 and start getting the lifetime income starting age 66 till age 120 or death.
At the end of the day, this is a life insurance, so for an event of immature death, all the cash value and death benefit will pay out to the beneficiary (increasing option adds the cash value, but fixed option does not).
This is my bread & butter type of insurance I protect to my clients with since it has many benefits for free and has many features to access the death benefit or the cash value (which you can use for education plan, wedding fund, or anything big purchase item).
The best life insurance policy is the one that is in force when you die. Most people live a long time which is great, but the vast majority outlive all the group term insurance that they get at work as well as the individual term life insurance they buy on their own.
To compound the problem, insurance companies have agents sell permanent policies that aren’t really “permanent” and lack the guarantees needed to keep the policy in force for life.
Aside from that, many people end up running into financial problems here and there and let their permanent policies get underfunded or lapse OR are tempted by the cash value to surrender them before they die to get the money.
The best thing you can do is whatever life insurance policy you get, you get from a good company and it’s guaranteed to do what it supposed to do.
And by that, I mean only buy policies where the premium and face amount are guaranteed to never change for the term of the policy if it’s a term policy. Or, if it’s a whole life policy, that the premium, face amount and cash value are fully guaranteed by the insurance company to never change.
This also means you are probably best avoiding all the new fangled life insurance polices universal life, variable life or indexed universal life insurance.
So, to wrap this up, when you think what is the best life insurance you can get - look for guarantees first and foremost - that a policy will do what it is supposed to do.