what is straight life insurance?

Answer 1

straight life insurance - insurance on the life of the insured for a fixed amount at a definite premium that is paid each year in the same amount during the entire lifetime of the insured

Answer 2

This sounds like a generalized term.
1. The purest form of life insurance is term insurance - it is just insurance no savings feature or investment feature - this could be referred to as straight life insurance. With term insurance the rates go up each time you renew - makes sense since your are older and therefore more of a risk.
2. The next type of insurance is whole life, could be referred to Life at 65 or 70 etc also. To keep each year's premium level (or the same) you pay a higher premium than term for your age but the extra is used to pay for premiums when you get older so they keep the premium the same each year. Sometimes you pay until a specific age e.g. 65 or for life. Since there really isn't an investment feature you could say this is just straight insurance.
3. In the last 20 years life insurance companies have tried to add investment features to make buying insurance more attractive. You pay a higher premium than either term or whole life but the extra is used to invest in different funds similar to mutual funds. This can't be called straight life insurance because you have investment and insurance.
Most professionals say buy term or a small amount of whole life and the rest in term for your insurance and then any money you want for investments do an investment product. It will be cheaper and less complicated. Your insurance agent won't make as much money.

Answer 3

the narrowest definition is single period (year) term insurance.

responder #1s definition is called fixed period level pay term ... you pay the same amount every year for the life of the policy, say ten years. In order to do this, the company has to collect more in year one than the actual cost or value of the insurance in year one so that they'll have enough income in year 10 to pay the higher cost of the insurance then.

[the underlying cost of insurance, the probability that you will die within one year, increases as you get older.]

agents like to use terms like 'straight life' very loosely ... it makes you think you're getting the cheapest product when in fact that isn't so.

why is that?

in life insurance, the hardest part is getting the customer to sign up. a customer who signs up for 10 years is more valuable than one who signs merely for one year, even if he has a guaranteed right to renew [what if customer remains healthy (as most do) and then finds a cheaper company??]

so agent gets paid more for selling the 10 year level term policy than for a one year policy.

ah!! and that's the reason for the deception. Cash in agent's pocket today.


clear?

Answer 4

It's a slang term usually used for traditional whole life insurance. As Spock pointed out, you should actually ask the agent what they mean and explain it to you. You should also talk to another trustworthy agent also to get multiple perspectives. Friendly competition will breed a better deal for you.

Answer 5

its whole life insurance. you pay premiums for the rest of your life or until a certain age like 100

Answer 6

It will vary from country to country so better ask your agent