Basics of Life Insurance
Let’s break down the basics of life insurance. Life insurance is a contract between you and the insurance company, where you pay premiums in exchange for a lump-sum payment to your beneficiaries upon your death. This money can help cover funeral expenses, replace lost income, pay off debts, and provide financial stability to your loved ones. Let’s explore the various coverage options available to you.
- ⚱️Term Life Insurance: Term insurance policies are less expensive as compared to other forms of insurance. It is the most common form offered by your job. However, term insurance does not offer any cash value or living benefits. Premiums paid for these types of policies purchase strictly death benefits only and are for a specified period of time such as 10 years, 20 years or 30 years.
- 🏦Indexed Universal Life Insurance: Indexed Life policies are a more recent evolution from traditional life insurance policies. While the premiums are slightly more than term insurance, policy premiums are adjustable and these policies earn a cash value. The value is based on interest crediting that is linked to the performance of a known stock or similar index (such as S&P 500). It can grow tax-deferred and matures at age 100. Protection and cash when you need it most!
- 💰Whole Life Insurance: Whole life insurance is also slightly more expensive but is permanent protection that matures, at age of 100. While premiums are higher, these polices earn a cash value with a specified guaranteed rate of return. The cash value could be used for a verity of lifestyle events.
Each type offers unique benefits and features designed to meet your specific needs. If you are healthy, consider learning more about your own protection now. Don’t leave this important aspect of your life, to your job. Contact me here to learn which type of coverage can help best fit with your financial goals and lifestyle.
