Many types of insurance policies are available today. You should buy the one which suits you best and for this you should know about each one of them in detail. This will help you in selecting the right policy for yourself. Whole Life Insurance is a very important and popular insurance policy which offers life long protection to your nominee. The insurance company pays all your debts and this is big back up for your family in case something happens to you. Its advantages are that it provides you life long security, the premium remains fixed. You can withdraw during your lifetime and the insurance company is accountable for the cash value of the policy. You can also use dividends to reduce your payments. Its biggest disadvantage is that it doesn't allow you to spend in different accounts like stock, money market etc. The premium and face amount is not flexible and you cannot move your money between accounts nor can you split it among different accounts.

With Universal Life Insurance you can earn market rates of interest on your cash value. It is a flexible policy which offers a tax-deferred cash value at minimum risk. Its pros are that it pays a death benefit to the nominee. You get premium and face amount flexibility. You can also withdraw or borrow from the policy at any time. Its drawback lies in the fact that it doesn't allow you to invest in other accounts. Like Whole Life Insurance, this too does not allow you to move or split your money among different accounts.

Variable Life Insurance provides you permanent protection. In addition to this it also gives you the freedom to invest your money in different accounts thereby helping you in building tax-deferred wealth. You can borrow from the policy at any time. Death benefit depends on the cash value account. The more the cash value the more the benefit. Its disadvantage is that it does not give you premium and face amount flexibility. There's no guarantee to the amount of cash value during your lifetime.

Universal Variable Life Insurance is a very popular policy because it gives you more cash value than any other policy. With this policy you can invest in stock, money market etc. It gives you premium flexibility and offers you tax-deferred cash value option at low risk. You can withdraw or borrow from the policy at any time; though the amount is less than the total cash value return if you withdraw early. It takes your time and that is its drawback. You need time to manage your accounts. Also the premium should be big enough to cover your insurance and other investment accounts.

All the policies have their pros and cons. With the help of your insurance agent; you should choose the one which suits you best.