Life Insurance
Finding a life Insurance Policy to Meet:
- Your needs.
- Your budget.
- The amount of time you need it to be guaranteed.
- How much, if any, risk you can accept.
- Even how actively involved in managing the policy you’d like to be.
Everyone’s needs, goals and preferences are different. We want to help you find the right policy.
Types of life insurance policies
The two basic types of life insurance are term life and permanent (cash value) life. Term policies provide life insurance protection for a specific period of time (subject to the claims-paying ability of the insurer). If you die during the coverage period, your beneficiary receives the policy death benefit. If you live to the end of the term, the policy simply terminates, unless it automatically renews for a new period. Term policies are available for periods of 1 to 30 years or more and may, in some cases, be renewed until you reach age 95. Premium payments may be increasing, as with annually renewable 1-year (period) term, or level (equal) for up to 30-year term periods.
Permanent insurance policies provide protection for your entire life, provided you pay the premium to keep the policy in force (subject to the claims-paying ability and financial strength of the insurer). Premium payments are greater than necessary to provide the life insurance benefit in the early years of the policy, so that a reserve can be accumulated to make up the shortfall in premiums necessary to provide the insurance in the later years. Should the policy owner discontinue the policy, this reserve, known as the cash value, is returned to the policy owner, subject to applicable surrender or early withdrawal charges. Permanent life insurance can be further broken down into the following basic categories:
Term life insurance provides a stated benefit upon the policyholder’s death, provided that the death occurs within a certain specified time period. Unlike other types of life insurance, the policy does not provide any returns beyond the stated benefit. If the policyholder wishes, the policy can often be converted, within certain guidelines, to a permanent policy at a later date.
Universal Life Insurance or Whole life is a standard insurance policy that remains in force for the policyholder’s lifetime. It offers both insurance death benefit protection and a cash value accumulation. Premiums do not rise as you grow older, but are substantially higher than term insurance premiums in the early years for the same coverage. The excess premium typically builds cash value on a tax-deferred basis.
Compared to traditional Universal Life, Indexed Universal life (IUL) offers greater upside potential on cash value accumulation as interest is credited to the policy based on a specific index or several indices. Compared to UL, IUL products have similar insurance charges, minimum guarantees and flexibility in modifying both the death benefit and premium payments. And as with many UL product offerings, Indexed Universal life policies are available in single life, survivorship and even single premium versions.
Variable Universal life insurance (VUL) offers permanent coverage and investment options to accumulate cash values utilizing variable sub-accounts. As the name suggests, VUL policies offer fluctuating benefits. Under most forms of VUL, you can vary the amount and timing of premium payments, subject to certain minimums. The insurance company invests the premiums and offers a choice of funds, in which the premium money will be invested. The amount of money beneficiaries will receive and the cash value of the policy depend on how well the insurance company invests the money.
Linked Benefits
Life insurance also offers a way to protect what is valued most in the event of a chronic illness or long-term care event. We know the ins and outs of each option and can find the best fit for your needs.
Comparison of Types of Life Insurance
