Is life insurance really that necessary?

Life insurance can be the basis of good planning when it comes to your financial life.   Look at a few of the following to see how life insurance can impact your life.

Replace lost income for survivors.

Most likely, some else depends on your income and life insurance can replace that money if you pass away.   It could be for the children but your parents, brothers and sisters and even adult children that still rely on you financially.  In many cases the government or employer benefits will be reduced after your passing, and life insurance is a way of compensating for that loss.

Pay final expenses not covered by health insurance.

Life insurance can pay your funeral and burial costs, state probate and estate administration costs, debts and some medical.

Create an inheritance for your survivors.

By naming beneficiaries to your policy, you can provide them with an inheritance from the life insurance policy.  Even if there are no other ‘estate assets’, your policy will provide some payout.  Your life insurance can also take care of ‘death’ or estate taxes.

Use it as a source of cash.

Several types of insurance allow you to borrow or withdraw cash from the money you have paid in.  It’s like a savings plan that you have to pay into.  Ask us about all the options that are involved in these life insurance plans.

What types of life insurance are available?

The basic types of life insurance are Term and Permanent or Whole Life.

Permanent Life Insurance / Whole Life

Permanent Life is just what mean, life insurance that continues for as long as you do.  This kind of policy usually builds cash equity in addition to providing a death benefit.   This is sometimes referred to as Whole Life Insurance.

Within this category there are three types of life insurance—traditional whole life; universal life, and variable universal life, and each one has sub categories, so consult us for the details to shape you life insurance policy for your specific needs.

Term Life Insurance

This is the most basic type of life insurance paying only if you die.  The coverage can last various amounts of time, such as 5, 10, 20 or 30 years.  Unlike permanent insurance, there is no cash value on the policy.  If you live longer than the term of the policy, the insurance company considers the agreement met and the coverage ends.  You may be able to renew you Term Insurance, but in most cases the premium will increase.