Comparison of Life Insurance Policies

Life insurance policies are complicated. They contain terms and provisions, that are just legalistic mumbo-jumbo to most of us. Added to this, there seem to be countless types and varieties of insurance policies.

The materials that follow present a summary comparison of the most common forms of term, cash value, and specialized and hybrid policies in a tabular format. Although we have tried to hit the high points of the most common types of in use, please note that various insurance companies — primarily for marketing reasons — create their own names for specific variations of the general insurance types noted here. However, you should be able to find a description of what type of policy it is buried in the first few pages of the policy.

Here is a listing of the policy types that we compare:

Term policies

• Annual renewable term
• Level term
• Decreasing term
• Mortgage insurance
• Increasing term

Cash value policies

• Whole (ordinary) life
• Graded premium life
• Limited pay life
• Interest sensitive life
• Endowment policies
• Single premium life
• Universal life
• Variable life
• Universal variable life
• "Vanishing premium" policy
• MEC (modified endowment contract)

Selected specialized/hybrid policies

• Joint first-to-die policies
• Second-to-die policies
• Adjustable life policies
• Family income policies
• Family maintenance policies
• Family (family protection) policies