Life Insurance 101

We are going to explore the basic types of life insurance...

Term Life is affordable, temporary coverage. There are term policies that can be converted (keep in mind that in most cases your premium will increase) to permanent policies once your financial circumstances change.

Term life insurance policies are policies that provide affordable, temporary coverage. Term policies contain no cash value, are designed for pure protection, and are particularly suitable...

• For protection against outstanding loans and debts for which family members or others may be responsible;
  
• For families who feel they cannot currently afford a permanent policy but who need to protect their children from financial hardship due to the potential loss of a parent.
  
• To guard against uninsurability in the future: If you buy term insurance now, you can continue this coverage even if you become uninsurable.
  
• To provide coverage on other family members
  
• To protect key people of a business in its formative years of growth
  
• To purchase time _ time to increase your earnings so that the coverage can be converted to a permanent cash value life insurance policy without evidence of insurability
  

In addition to providing necessary coverage at an affordable rate, Term life insurance protects your insurability. By buying a convertible Term policy now, you can convert your policy to a permanent life insurance policy without providing evidence of insurability _ even if your health tomorrow is not as good as it is today.

Whole Life provides the security of level premiums and guaranteed coverage.

Whole Life is the traditional form of permanent life insurance. It provides...

• the certainty of level premiums;
• a guaranteed interest rate; and
• a guaranteed death benefit.

An ideal product for the young and the old, Whole Life provides the extra security of guaranteed protection at affordable rates, yet it maintains the element of cash value accumulation for pre- and post-retirement needs.

Current forms of Whole Life insurance enable policyowners to benefit from favorable experience and a strong economy by crediting excess interest to the policy. These "interest-sensitive" Whole Life policies are popular with individuals who value strong underlying guarantees but don't want to miss out on the opportunity for increased cash-value performance.

Like all forms of permanent life insurance, Whole Life may be converted into retirement income. When you reach retirement, you can use loans and withdrawals from the policy's cash value to purchase an annuity that can provide additional funds for your retirement needs*.

 

Universal Life provides you with what you want with Whole Life coverage with the flexibility of adjusting your premiums and death benefits..

Universal Life is a flexible premium, adjustable life insurance product that provides you with the flexibility of choosing the policy features that are appropriate for you and adjusting those features as your financial priorities and needs change.

• When you are in the formative years of raising a family, for example, you can increase your policy's death benefit for extra needed protection.
  
• When a child reaches the age of higher education, you can borrow or withdraw from the cash value of the policy to help you pay college expenses*.
• When your family obligations are reduced, you can decrease your death benefit or increase your premiums up to specified maximums to build a cash value that can help you enjoy a retirement with dignity

 

Indexed Universal Life gives you the death benefit and guarantees of life insurance, combined with the opportunity to earn interest linked to the upward movement of a stock market index (without the risk of investing directly in the market), you may wish to consider indexed life insurance.

Like all universal life insurance, Indexed Universal Life allows you to choose the policy features that are most appropriate for you and to adjust those features as your financial priorities and needs change. It offers...

• A death benefit paid to your loved ones generally free from federal income taxes.1
• The flexibility to determine the amount and timing of premium payments.
• The flexibility to increase or decrease the face amount after issue.2
• The flexibility of tax-deferred growth of policy cash values, which may be used to pay for monthly costs of insurance or accessed via policy loans and withdrawals to use as you wish.

Unlike other interest-earning life insurance policies, however, Indexed Universal Life offers interest linked to a stock market index – without the risk of investing directly in the market.

 

Variable Life allows you to try the investment market, there's Variable Life Insurance which provides a death benefit and the opportunity for you to invest your premiums in various Separate Account investment portfolios.

In addition to offering you this flexibility, however, Variable Universal Life allows you to invest in a number of Separate Account investment portfolios.

• You, not the insurance company, decide how you want your premiums allocated;
  
• You can reduce risk by spreading your money among a number of Separate Account investment portfolios; and
  
• You can choose the investment options that most closely match your tolerance for risk and your financial goals.
• Unless you the client have a complete understanding of the mechanical parts of a Variable Life Insurance policy we encourage you to perhaps consider another solution to you situation.