What is Life Insurance & Why Do I Need It?
Life Insurance covers the cost of a deceased loved ones final expenses and burial costs and/or provides extra financial security for the family members that are left behind. Some policies can also be beneficial while living by building cash value or adding riders such as the Accelerated Death Benefit rider, which allows you to access a percentage of your life policy death benefit if you are diagnosed with a terminal illness.
Types of Life Insurance Coverage
Term Life Insurance
Term Life policies are the least expensive type of policies providing a higher death benefit for a specified number of years. Retirement funds are at their lowest level in many years and Term Life Insurance provides an inexpensive alternative to protect your family.
Term Life policies are ideal if you have a mortgage, or if your family will need income in the event of your premature death. They can provide a death benefit for as low as $50,000. They do not build cash value; however, they cost less than other types of life policies.
Term policies are often taken out to supplement the cost of mortgages, college tuition, and a key-man or business income. Most term policies are renewable or convertible.
Universal Life Insurance
Universal Life policies can provide coverage for both final expenses and family support. However, one of the best features of a Universal life policy is that they can also be very beneficial while you are living your life because they build cash value. They tend to be more expensive than term policies because they build cash value and are guaranteed for life as long as you pay your premiums.
While Universal Life policies are more expensive than Term Life polices, they are extremely flexible and they come in many different shapes and sizes. They tend to be more expensive than term policies because they build cash value and are guaranteed for life as long as you pay your premiums.
Universal policies do not have a time limit on when they expire. As long as you continue to pay the premiums, your policy will remain in force with no increase in premium. We recommend obtaining these policies while you’re young to get low premiums.
Whole Life Insurance
Whole Life policies normally cover final expenses or burial expenses of a deceased loved one. They can provide a lower death benefit usually as low as $3,000. They not only provide a fixed death benefit but they also provide a decent cash value as well. You may also take a loan from the cash value but you will be charged interest and expected to repay the loan.
Do You Need Life Insurance?
Everyone’s living situation is different, making the perfect time to purchase a life insurance policy different for everyone including which type of policy to purchase. To learn more about the benefits of life insurance, please contact our office to schedule a one on one consultation with one of our skilled Agents.