For this type of protection, the policyholder makes an agreement with the insurance company that on scheduled dates, a certain amount of money known as the premium would be paid to the insurance company. Typically, USA life insurance companies have a determined amount. For instance, a person could take out a policy for $10,000 or into the millions. However, the more money being purchased that would be paid out at the time of death the more expensive the premium and the more criteria to qualify for the policy.
It is important to understand that the agreement between the company providing USA life insurance and the policyholder is legally binding. This contract outlines any limitations of the policy, the types of events in which money would be paid out, any exclusions, and so on. For instance, most life insurance policies will not paid out money if the policyholder commits suicide, defrauds the insurance company, dies participating in a riot, or gets involved with any type of civil commotion.
When looking at USA life insurance policies, the contracts typically fall into one of two main categories, which include:
1. Protection – These policies are created so a benefit would be paid out for a specific event. Typically, the payout is a lump sum and the most common type of protection life insurance is known as “term life”.
2. Investment – Another type of USA life insurance policy is designed to increase in capital every time the policyholder makes a single premium. The most common types of policies for the investment category include universal, variable, and whole life.
There are so many different USA insurance companies but the following are some of the best known, the companies that have the highest ratings and the happiest policyholders.