divine provision insurance agency

Telephone number: (800) 854-1762

Life Insurance in a Nutshell


There are  four main types of life insurance. They are term, whole life, universal life and endowments. Each type of coverage is different and has different costs and features. The type of insurance that is best suited for you   depends on your particular needs and circumstances.


Insurers also refer to term life insurance as temporary life insurance due to the way these policies are structured. With term life insurance, your coverage is in effect for a set number of years. Typically, term coverage policies are issued for ten, twenty, or thirty years. These policies guarantee coverage for the contracted time without needing to requalify year after year. Once the policy expires, the policyholder will need to apply for a new term.

Term policies are generally less expensive than the other types because they provide no cash-back  feature and also due to the shorter period of coverage they provide.  This makes term policies a very  appealing option for many people. The disadvantage of term policies is that policyholders must reapply once the term is up. This  involves higher premium costs as one gets older. There is also no savings feature as with other types of life insurance.


As the name suggests, whole life insurance lasts for the policyholder’s whole life. As a trade-off, the price of whole life policies tends to be higher than term insurance. These fixed premiums mean policyholders can lock in a lower rate if they apply for whole life insurance when they are younger and healthier.

Whole life insurance policies also work as tax-free cash accumulation instruments, allowing one’s premium costs to build value over time. If policyholders leave their premiums value untouched, that amount becomes part of the benefits distributed to the holder upon loans and surrender, or to their beneficiaries upon death.


Much like whole life insurance, universal life insurance is a permeant policy that allows for policyholders to build up cash value over time. Universal policies start to diverge from whole life when it comes to payments. Universal coverage allows for premium payments at any time in any amount, providing great flexibility. Holding off on payments does affect the overall value of the policy.

Endowment Insurance

 Endowment insurance life insurance policies that offers a death benefit and a guaranteed lump sum payout at the conclusion of the policy term, as long as premiums are paid. To fund the endowment, you pay premiums into a policy, and the policy’s value grows over time. If death of the insured occurs before the endowment date, the face amount of the policy plus accumulated dividends are paid to the beneficiary. Endowment policies allow the owner to borrow money  from the value of the policy.

Long Term Care Insurance

Long-term care insurance, also called LTCI, pays out the cost of medical and non-medical services provided for senior-aged individuals who have lost the ability to care for themselves. It covers individuals cared for at home, nursing homes, assisted living facilities, or adult day care centers.

Disability Income Insurance

Disability income insurance is designed to replace lost income due to sickness or accidents. Such policies are issued with a waiting period, after which a portion of the insured’s income will be paid. These policies come with waiting periods of 30, 60 or 90 days wait.


Important Life Insurance Terms

Automatic Premium Loan

Automatic Premium Loan allows cash value to be used to pay premiums to prevent the lapse of the policy


A beneficiary is the person or entity that the policyholder designates to receive the death benefit. This can be the insured’s spouse, immediate family, other relatives, friends, business partners, or even a charitable organization. Policyholders can name several beneficiaries for their life insurance plans and assign how much benefit each person or group will receive.

Cash Value

Cash value represents the amount of cash that the policy owner can borrow from or receive from the policy, in the event the policy owner wants to surrender or cancel their policy.

Convertible Term life insurance

This type of policy can be converted into permanent insurance without the need for medical assessment. The insurance company is required to renew the policy regardless of the insured’s health status, subject to policy conditions.

Death Benefit

This refers to the amount that the insurer pays the beneficiary after the policyholder’s death.

Living Benefits Coverage

This rider provides long-term care coverage for the policyholder if they become terminally ill.

Surrender Value

This refers to the amount the policyholder will receive from the insurer if they decide to exit the policy before it matures. The value is often significantly lower than the actual benrance Terms