Life cover will cover the future in case of an unexpected death. Dependents can depend on the proceeds of a life insurance policy to pay a mortgage, cover funeral expenses or maintain their current standard of living. Business partners can carry on without interruption with the money from a life cover policy.

Term Versus Permanent Whole Life Cover

Applicants can seek term life cover or permanent whole life insurance. Term insurance is selected by many people because it is more affordable and customizable. With term insurance, the coverage lasts for a specified period of time and then ends, which makes it useful to cover a variety of life expenses such as a mortgage or educational cost for children. Permanent life cover is used more often in estate planning for older folks trying to minimize the impact of inheritance taxes on their dependents. The sum paid out remains the same with permanent cover and the policy stays in effect as long as the premiums are paid.

Types of Term Cover

When term cover is chosen, there are a variety of options based on the unique needs of the dependents who would be left behind.

• Decreasing term cover charges the same monthly payments throughout the term but the payout of the policy upon death decreases over time. This is policy is a good option if paying off a mortgage is the primary concern for dependents.

• Increasing term cover also maintains the same monthly payments but the payout of the policy upon death increases over time, to account for inflation and the rising cost of living for dependents.

• Deposit term insurance is renewed in 10 years and the insured makes security deposit when purchased. The security is returned with interest at the end of the term when a policy has been maintained for a minimum of 10 years. This policy offers a great deal of flexibility as well as a small savings with interest.

• Re-entry term insurance is the least costly and can be purchased at select rates below standard. When the term of the policy is up, proof of good health must be submitted to maintain select rates. People in poor health should carefully consider this type of policy.

• Renewable term insurance can be renewed at the end of the term without taking a physical or submitting proof of good health. Increases in premiums would occur regularly but not in accordance with health conditions. This is an ideal policy for people with health conditions because no additional medical exams are required.

• Non-renewable or non-convertible life cover expires at the end of a set time period, such as ten year.

• Convertible term life cover has a can be converted into a different policy with a higher premium, such as whole life cover or an endowment policy. This policy is perfect for people who expect their financial situation to grow and change.

Cost of Life Cover

The cost of life cover is determined by the level of risk involved to insure the person. If the person is in poor health or older, life insurance is more expensive because there is a greater risk of actually cashing in the policy. For the lowest cover costs, applicants should maintain good health and avoid smoking and other dangerous conditions, especially if a medical examination is required.

Constantly Changing Life Cover Options

The National Association of Insurance Commissioners (NAIC) has a Life Insurance and Annuities Committee to regulate the constantly changing needs of the life cover market to protect consumers. Chair of the Committee, New York Insurance Superintendent Eric Dinallo, states, “I am honored to chair this important committee at this crucial time for state insurance regulation...to help find national solutions to some of the issues facing the insurance industry. As the laboratory for innovation, the states can provide the kind of responsive regulation that enables industry growth while maintaining unsurpassed consumer protection."

There is a life cover policy to cover the needs of all dependents, regardless of the budget or circumstances of the insured.