Life Insurance
Helping You Take Care of Those That Matter Most
A life insurance policy is a contract between you and an insurance company. Its main purpose is to provide a financial benefit to your loved ones if you die.
Why Life Insurance?
Life insurance is absolutely essential if there’s someone you care about who would suffer if you and your financial contributions were no longer in the picture. This could include a spouse, children, disabled family members, aging parents or anyone else who depends on your earnings to make ends meet.
There are several different types of life insurance, but what they all have in common is that they pay cash to your loved ones in the event you pass away. This lets your nearest and dearest remain on firm financial ground even though your earnings have stopped.
Types of Life Insurance
There are two main types of life insurance: term life insurance and permanent life insurance.
Term
Term life insurance is the type of life insurance most people are familiar with. It pays a cash benefit to your loved ones (also known as your beneficiaries) if you were to pass away during the term. Typical terms are 10, 20 or even 30 years.
Term insurance is designed to meet temporary needs. This type of insurance often makes sense when you have a need for coverage that will disappear at a specific point in time. For instance, you may decide that you only need coverage until your children graduate from college or a particular debt is paid off, such as your mortgage.
Permanent
Permanent insurance provides lifelong protection. As long as you pay the premiums, and no loans, withdrawals or surrenders are taken, the full face amount will be paid. Because it is designed to last a lifetime, permanent life insurance accumulates cash value and is priced for you to keep over a long period of time.
There are different kinds of permanent life insurance. Some offer a guaranteed rate of return while others let you choose a mix of investments for a variable rate of return. Meanwhile, some require you to pay fixed premiums while others let you vary the amount based on your financial circumstances. Others even let you skip premium payments and increase or decrease your coverage level over time.