Life Insurance

Tips and Tricks:

• Reevaluate your life insurance needs annually or after significant life events. Updates may be needed such as the beneficiaries, increase in coverage, or even reduce your coverage

• Each policy is unique to the insured and insurer.Review your policy document to understand what risks your policy covers, how much it will pay, and under what circumstances

• The policyholder and the insured are usually the same person, but they may be different. For example, a business might buy a key person insurance or an insured might sell his or her own policy to a third party for cash in a life settlement
   

Who needs it?
 

Life Insurance provides financial support to the surviving or any other beneficiaries after the death of the insured. Examples are provided below:

• ​Parents with minor children

• Parents with special-needs adult children

• Adults who own property together

• Elderly parents who want to leave money to adult children who provide their care

• Found adults whose parents incurred private student loan debt or cosigned a loan for them

• Young adults who want to lock in low rate

• Wealthy families who expect to owe estate taxes

• Families who can't afford burial and funeral expenses

• Businesses with key employees

• Married pensioners
   

Are there different types?
 

Yes! there are several different types of life insurance to provide the benefits needed in your life

• Term Life- lasts a certain number of years, then ends. You choose the term when you take our the policy.

• Level Term-The premiums are the same every year

• Increasing Term-The premiums are lower when you're younger and increase as you get older. this is also called 'yearly renewable term'

• Permanent- This stays in force for the insured's entire life unless the policyholder stops paying the premiums or surrenders the policy. It's typically more expensive than term

• Single Premium-In case the policyholder pays the entire premium up front instead of making monthly, quarterly, or annual payments

• Whole Life-A type of permanent life insurance that accumulates cash value

• Universal Life-A type of permanent life insurance with a cash value component that ears interest, universal life insurance has premiums that are comparable to term life insurance. Unlike term and whole life, the premiums and death benefit can be adjusted over time

• Guaranteed Universal-Does not build cash value and typically has lower premiums than whole life

• Variable Universal-The policyholder is allowed to invest the policy's cash value

• Indexed Universal-Lets the policyholder earn a fixed or equity-indexed rate of return on he cash value component

• Burial of Final Expense-Type of permanent life insurance that has a small death benefit. Despite the names, beneficiaries can use the death benefit as they wish

• Guaranteer Issue-Type of permanent life insurance available to people with medical issues that would otherwise make them uninsurable, guaranteed issue life insurance will not pay a death benefit during the first two years the policy is in force (unless the death is accidental) due to the high risk of insuring the person. however, the insurer will return the policy premiums plus interest to the beneficiaries if the insured dies during the period

Additional Uses for Life Insurance

Usually, life insurance is used to provide money to beneficiaries but there are also other usages for life insurance

• Funding Retirement

• Avoiding Taxes

• Borrowing Money