Many people feel uncomfortable planning for life Insurance because it is connected with the end. Consequently, if the appropriate steps are not taken, loved ones won’t be financially protected.

How does it work?

“A life insurance policy is a contract with an insurance company. In exchange for [monthly] premium payments, the company provides a lump-sum payment, known as a death benefit to beneficiaries upon the insured’s death,” (Source). Since average people don’t have the means to pay for uncertain and high cost-events; life insurance takes away that financial obligation.

Who needs it?

Typically, those who have families dependent on their income need this insurance the most. Examples are single parents with children, small business owners, families with special needs children or families with one spouse who provides income.

Types of Life Insurance

There are several types of insurance to choose from; although, term is the most common. In illustration, term insurance is “a policy with a set duration limit on the coverage period,” (Source). The policy can be renewed or not upon coverage period.

Whole Life “provides lifetime protection by paying a lump sum death benefit. They have a savings component with earning accruing referred to as cash value,” (rebel Financial).  

Universal Life can be thought as Term and Whole Life insurance combined, with a few more perks. It is low-cost, provides cash value build up, flexible, and premiums can be paid with interest from accumulated savings.

Indexed Universal Life “allows the owner to allocate cash value amounts to either a fixed account or an equity index account,” (Source).

Variable Universal Life “is a type of permanent life policy with a built-in savings component that allows for the investment of the cash value. VUL policies typically have both a maximum cap and minimum floor on the investment return associated with the savings component,” (Source).

Conclusion 

If you have any questions about planning for life insurance, be sure to make an appointment. Contact us HERE! 

Need help choosing a life insurance company? Below is a list of the TOP 10 companies in the country! Pricing and reviews are available in the link below.

Curious how much coverage you need when it comes to life insurance? Try out the calculator below to get an estimate.