Types of Life Insurance

It is hard to believe that the oldest form of insurance is the least common.  Life insurance has been around for hundreds of years where as health insurance came out within the last century.  The life insurance industry hasn't really changed with all the insurance reform discussion, and the types of insurance are unaffected as well.  I will discuss the basics of the differences of life insurance rather than get into all the boring details and spare you the classroom session.


The types of insurance can vary depending on what suits your lifestyle.  If you are looking to protect a particular period of time or want the cheapest form of life insurance then term would probably suit you.  And if you think you want reliable premiums and coverage that lasts your entire life then whole life would be your best bet.  


Here are 3 types of life insurance:

Term life insurance

1.  Term life insurance- This type of life insurance coverage guarantees a certain term like 5, 10 or 20 years.  The premiums stay the same and and the end of the term you may be qualified for more coverage but the premiums would go up.  During the term, if the policy lapses there is really nothing to show for it unless you added an optional benefit rider.  This is generally the least expensive form of insurance.


2.  Whole life insurance- This type of life insurance guarantees a death benefit for an entire life.  The premiums are set but are higher than term insurance.  This type of insurance also creates a cash value that the policy holder has access to and may take out loans if he/she likes.  Whole life is also known as permanent life insurance because can last for the policy holder's entire life.

3.  Universal life insurance- This type of life insurance is kind of a hybrid between the two.  It is a type of permanent life insurance based on a cash value. That is, the policy is established with the insurer where premium payments above the cost of insurance are credited to the cash value.  Payments are not needed every month however, the cash value could run out so it should be monitored as the policy ages.  There is also a variable universal life insurance which uses the stock market and can get very complicated.  Please see your life insurance professional for details.

And these are the 3 types of life insurance that you should be familiar with.  There are other types but most of them play off the three basic types that I mentioned here.  If you are interested in any of the insurance plans mentioned feel free to contact a life insurance professional for more information.

Term Life Insurance

I know I have been on a rant lately about Whole Life insurance.  I am actually in the process of buying my first Whole Life policy now.  I would like to mention Term insurance now, a policy most folks like because of its affordability.

If you haven't talked with your life insurance agent in a couple of years, talk to us and we can probably save you money!
 
Do you wonder if you have enough life insurance? Are you married? New child? New home? Job promotion or loss? These are all good reasons for you to contact us and check your coverage now.

Term Life Insurance rates have dropped dramatically in the last decade. At (your website or name goes here) we research the top insurance companies in the country for you, so you only make one call - to us! Let us find you the lowest cost term insurance for you to protect your family. 

Plans as low as $3 a month!

We also help clients in poor health get life coverage. Even if you think you can not get protection, please contact us, so that we can help you protect your family. We specialize in poor health clients.
 
All Quotes are Confidential, No Cost, and No Obligation. Contact us today!
 
This information is strictly confidential and will not be shared with anyone.
 

7 Reason to buy Whole Life Insurance

So I've decided to give politics a break.  It has really heated up lately.  I don't remember things so polarized as they are right now.  I wish everyone could take a break to and go home.  Be thankful for this country and enjoy it for what it is.  Something tells me it won't be this way for long.

I would like to talk about life insurance.  Did you know that 56 percent of married couples believe that their current life insurance coverage is inadequate.  I know most folks like Dave Ramsey and I agree with most of his outline for becoming debt free but I do not agree with buying term and investing the difference.  I happen to believe that permanent life or whole life is a far better buy.  These points should shed some light on the subject.

Facts about Whole Life
1.  Premiums guaranteed for life- Once you enroll in a whole life policy it will last you your entire life.  The premiums will not increase.

2.  Death benefit is guaranteed for life- The face amount, or coverage amount is guaranteed.  Some policies will decrease in value as the client ages due to higher risk of death, but once whole life is in place, it is there to stay.

3.  Guaranteed cash value growth- The cash value in most cases, is guaranteed to increase which is better than mutual funds which cannot guarantee a growth.  Here is where Dave and I disagree.  He claims term is much cheaper and you can invest the difference in a mutual fund earning 12%.  Well show me a mutual fund that earns 12% and I will be all over that!  I have still yet to find these funds he speaks of.

4.  Liquidity through loans against cash value- You may take out loans on the cash value of your policy for the entirety of your policy.

5.  Can provide retirement income- If the cash value of the policy is high enough, then the client may take retirement from the cash value and retain the death benefit originally purchased.  Even some commentators in the news media are gaining an appreciation for the value of whole life, especially after the stock market downturn of late 2008 and early 2009.

6.  Not accessible to creditors- Whole life is an exceptional wealth building vehicle that not only protects, but builds wealth and no one can touch it.

7.  Income-tax-free death benefit- My favorite part about whole life is that Uncle Sam cannot touch it either.  He cannot touch the loans on the cash value, the death benefit, or the increases in cash value.  This product is not taxed period.

So here are a few reasons to get you started on your journey to whole life.  I have much more I'd like to write about, but maybe another time.  In the meantime check out  Nelson Nash's book on the Infinite Banking Concept.  It shows many ways to take advantage of whole life insurance.