Residents looking for a California life insurance policy have several decisions to make. You'll first need to determine why and if you really need to have life insurance, the best type of policy to meet your needs, and finally you will need to select a company that you trust to provide the coverage. Life insurance is designed to protect people from the devastating financial implications that accompany losing a loved one who is also a main source of income or care giving. By learning about the protection available, the different types and options for life insurance in the state of California, and comparing your choices, you will be in the best possible position to protect the people who depend on you most.

Understanding the Purpose of California Life Insurance

You need life insurance if you have dependents that rely on your income or care-giving abilities. This means that a parent or spouse who is the main bread winner needs to be insured. It also means that if you stay home taking care of small children, you care for an elderly or disabled person, or you perform homemaker functions that could not be carried out in your absence without hiring someone else to do them, that you should be covered as well.

Most life insurance products work on the premise that you pay into the account on an on-going basis over your lifetime. When you die, money is paid to your beneficiaries (people that you specify to receive the funds) in the form of a death benefit. Death benefits can be used to pay for the special needs of a disabled person, pay for a child's education, to hire a nanny or housekeeper, to replace the direct income of the former wage earner, to pay off a mortgage or other debt, or to pay for taxes and funeral expenses.

Not every resident of California needs a CA life insurance policy. If you don't have anyone who depends on you or your income then it is not a necessary investment. However, for those people who do, and are not independently wealthy, it is essential. Once you decide that this is a form of protection you want to have in place, you need to learn about the type of coverage options that are available.

Types of California Life Insurance Policies

Life insurance is generally referred to as either temporary or permanent coverage. There are four main classes of insurance that you need to be aware of: term, universal, whole life and endowment. These are explained in detail below.

California term life insurance is a temporary type of coverage written for a set term, or period, of time. When you buy this type of coverage it does not accumulate in value. Instead, it is just a guarantee of payout to your beneficiaries if you die. There is no other benefit attached. Some people feel that they would be better off investing these funds into another vehicle since there is no pay off, while others just like the security.

Permanent life insurance coverage, on the other hand, is designed to grow in value. This minimizes the cost to the company offering the coverage and gives the holder of the policy certain benefits and options.

Whole life coverage is a popular type of permanent coverage. Many people like this type of insurance for its set premiums, guaranteed death benefits and cash values. While these premiums are higher than term insurance premiums in the short run, they tend to even out over the life of the policy. The downside of whole life coverage is that it can't compare with most other investment vehicles in terms of return on investment. So you really need to consider what your goals for this product are.

Universal life policies are a more recent insurance product that also offers permanent coverage; however, the premiums are more flexible than in whole life policies. Also, this type of policy often offers a higher rate of return. Finally, you have two death benefit options. With an Option A benefit you receive the face value at a maturity age specified. Each time you pay a premium, it reduces the cost of coverage. With Option B the cost never goes down, but it pays both face amount and cash value at payout.

Endowment policies have more expensive premiums than either whole life or universal policies. This is because you will pay those premiums for a shorter period of time, and you will receive the payout earlier. With this type of policy an endowment age is specified.

California Life Insurance Companies

The California Department of Insurance offers information on their website regarding the various companies that are licensed to sell this insurance product in the state. You can access them by market share and see what they are licensed to sell. They also offer a consumer hotline to answer questions about insurance of any type in the state. However, they are merely a regulatory agency meant to protect your interests. To actually purchase life insurance you will need to get quotes from some companies.

According to the state website, the top ten providers of life insurance in California by market share are:

• Metropolitan Life Insurance Company
• Prudential Insurance Company of America
• Hartford Life Insurance Company
• New York Life Insurance Company
• Northwestern Mutual Life Insurance Company
• Lincoln National Life Insurance Company
• Pacific Life Insurance Company
• American General Life Insurance Company
• John Hancock Life Insurance Company
• Axa Equitable Life Insurance Company

California Life Insurance Quotes

Of course, just because these companies have top market share doesn't mean they are the right ones for you. You can easily make this determination for yourself by comparing California life insurance quotes from top companies above. Just by entering a zip code you can receive life insurance quotes from California companies ready to work with you.

You have all the information to make the best decision on life insurance coverage. In fact, you are the only person truly in a position to make that choice along with assistance from a licensed California life insurance agent that can guide you through the actual buying process.

Get started doing your homework - compare CA life insurance quotes now!