Types of life insurance include:

» Individual Life Insurance
» Credit Life Insurance
» Group Life Insurance

We will touch briefly on credit life insurance since this product is sold by Mountain Life. We will talk about group life insurance since many people have group life coverage. Finally, we will then talk exclusively about individual life insurance.

Credit life insurance is written to cover large purchases such as trucks, automobiles and large appliances when these items are purchased and financed. Typically, the premium is paid as a single premium and financed as part of the purchase. The beneficiary of this insurance is typically the financial institution which provided the financing for the purchase. Credit disability insurance is often sold in conjunction with credit life insurance, but it pays when the insured is disabled under terms of the policy contract.

Group life insurance covers a group of people with something in common with the other members of a group. For instance, they are employed by the same employer or are members of the same association. If an individual in a group dies, the individual’s beneficiary receives the death benefit. Group health insurance and group disability insurance are typically offered to employees also.  With group you only have coverage as long as you are part of the group.

Individual life insurance is written on an individual and you will keep the coverage as long as the premiums are paid to maintain the policy.  An insurance company agrees to pay your beneficiary a specific amount of money when you die. The amount of premium you pay depends on a number of factors such as age, gender, health, occupation, whether you use tobacco, how much insurance you are purchasing, type of policy you are purchasing, and your lifestyle, such as if you participate in risky activities like race car driving or hang gliding.  Some life insurance policies provide death benefits only. These are called term products. Others provide a death benefit and cash values, which will be discussed later as permanent life insurance.