Life Insurance is the most effective and efficient way to provide immediate replacement for loss of family or business income and to preserve accumulated assets.
There are various types of life insurance:
Term - This is life insurance which provides coverage at a fixed rate of payments for a limited period of time. After the period expires, coverage at the previous rate of premiums is no longer guaranteed and the applicant must either forgo coverage or potentially obtain further coverage with different terms and conditions.
Whole life – Here the premiums are fixed, cash values are accumulated, original death benefit and minimum cash values are guaranteed as long as premiums are paid.
Universal Life – Premiums can be flexible, based on interest returns, has limited death benefit and cash value guarantees.
Term Life Insurance
Term life insurance is the least expensive type of life insurance coverage and is usually for a specific term or length of time. Any death benefit will only be payable if death occurs while policy is in force.
Advantages of Term Life Insurance
This is the most effective and efficient way to provide for family protection and/or business partners.
It can be used to provide income replacement for loss of family income and mortgage protection.
Term life insurance can be purchased for different lengths of time namely 10/15/20/25 or 30 years whichever works best for you.
Most term life insurance policies can be converted into Whole Life (WL) or Universal Life (UL) policies with no medical underwriting if converted during convertibility period.
Disadvantages of Term Life Insurance
Term life insurance policies do not accumulate cash values or build equity.
If you still need coverage at the end of the initial term a new policy will have to be applied for and premiums may become very expensive.
At any time that premiums are not paid the policy will lapse with no value.
Life insurance is often taken out to cover the following:
- Family income replacement
- Mortgage protection
- College education
- Business continuation
- Succession planning
- Key person coverage
- Executive compensation
- Protect bank loans
- Protect investor loans
- Creating a lasting legacy for life
For advice and guidance, please call one of our experienced and licensed insurance professionals at (888) 234-0532. We will gladly walk you through the options best suited for your specific needs.