Life Insurance

What is Life Insurance?

The main purpose of life insurance is to provide a financial protection to surviving dependents after the death of an insured. The amount of insurance needed varies from person to person depending on the financial needs of the individual at that given time.

It is important to re-evaluate life insurance needs annually or after a significant life event such as, marriage, divorce, birth of a new born child, major purchases such as a house or a investment property.

 

Term LifeIt is also known as pure life insurance and guarantees payment of a stated death benefit during a specified term. When the term expires, the policy holder can either renew the policy, convert to a permanent coverage, or allow the policy to terminate.

The purpose of a Term Life policy is to offer pure financial protection at an affordable cost. The benefits may be used by beneficiaries to settle the insured’s final expenses such as healthcare and funeral costs, consumer debt or outstanding mortgages and debts.

 

Whole LifeWhole Life Insurance is a type of permanent life insurance with an investment savings element. Whole Life policies come in participating (pays dividends) and non-participating (do not pay dividends). The investment and premiums are not flexible, but the policies have guaranteed cash values.

The purpose of a Whole Life Policy is for estate and inheritance planning. The investment component of the product may accumulate interest on a tax-deferred basis. Cash Value that grows is an essential component of Whole Life Insurance.

 

Universal LifeUniversal Life Insurance is a type of permanent life insurance with an investment savings element. Unlike Whole Life policies, Universal Life Insurance policies contain flexible premiums and flexible investment selections.