Many individuals avoid having this conversation. After all, no one wants to think about a loved one passing away. Let’s be frank, we are all going to die. Life Insurance is one of the most important ways to secure your family’s financial future. You obviously clicked on the life tab on our site to learn more about life insurance and your options. Let me give you some information that will help simplify your options.
Life insurance replaces income. If you have life insurance on yourself and you pass away, the life insurance death benefit (also called face amount) gets paid to your beneficiary that you would have previously named. This beneficiary can be a parent, a spouse, a child or any other person or entity you officially name. The amount of life insurance depends on your budget and estimate of any future debt that you want to cover such as paying off a house or providing for a child’s college education. The higher the death benefit, the more that you can expect to pay for the insurance. Depending upon the type of insurance and the amount, you may or may not have to take a physical.
Here are some different types of life insurance:
Guaranteed Level Term Life Insurance
These policies tend to be a popular choice because they are the least expensive, offer a fixed premium every month, and are available for a certain period of time (ex: 10 years, 20 years or more). At the end of the policy term, if the policyholder is still alive, the coverage ends. No death benefit gets paid out because the policyholder is still alive. These policies do not have any cash value. Upon the death of the policyholder, the beneficiary receives the death benefit income tax free.
Permanent Life Insurance
Whole Life policies are popular because they remain in effect for the entire life of the policyholder. These policies cost more but they have an added benefit. These policies build up cash value which can be accessed by the owner of the policy either by a surrender value or loan. Upon the demise of a policyholder, the death benefit and the cash value are paid to the beneficiary.
There are also Universal Life policies. These offer the policyholder the most flexibility when it comes to modifying the benefit amount or premium to accommodate changing needs. These policies build up cash value over time. These policies will allow you to contribute extra money into your accumulation account in addition to your premiums. This will allow you the flexibility to skip some payments from time to time during times of financial limitations.
If you’re interested in guaranteed level term or permanent life insurance quotes click here and we'll contact you or call us at 1-800-560-2443.
Below are some of the life insurance companies that we represent:
AIG, Banner, John Hancock, Mass Mutual, Lincoln, Mutual of Omaha, Nationwide, Pacific Life, Principle, Prudential & Protective