There are numerous benefits that life insurance can provide to policyholders – as well as to an insured’s loved ones and survivors. Life insurance is also a key part of a person’s overall financial plan. Life insurance can protect one’s family, one’s assets, and the overall lifestyle of the people you love the most.
In the event that a person dies, life insurance coverage can provide benefits such as paying for a funeral and other final expenses. But the policy proceeds can do so much more, such as pay off the balance of a mortgage, make up for a breadwinner’s lost income, or fund a child or a grandchild’s future higher education costs. Overall, the proceeds from a good solid life insurance policy can help you keep your promises.
When you are considering the purchase of a life insurance policy, the amount of coverage – or death benefit – is important, as is the budget for premium expense. So, for those who are seeking a low-cost life insurance option, it may seem that a lower premium term life insurance policy could be a good alternative. If you are looking to purchase life insurance for your parents, AICPA life insurance policies or FEGLI we can help you with those well!
Weighing Your Life Insurance Coverage Alternatives
There are many factors to consider when you are going through the purchase of a life insurance policy. First, you need to decide which type of policy is right for you. For example, will you go with term life and obtain pure death benefit protection, or will permanent coverage be better so that you can have death benefit coverage along with a cash value build up?
Next, you also need to choose the right amount of coverage. Even though roughly 80 percent of Americans today own at least some amount of life insurance coverage, most people admit that the amount of protection that they have is not likely enough to meet their anticipated future needs.
There are several different factors that you need to consider how much life insurance that you’ll need to buy. The first thing that you should do is add up all of your debts and other final expenses that your family would be responsible for if you passed away. The next thing that you should look at is your annual income. If you’re one of the main income earners in your home, your family would struggle. Your life insurance gives them the money that they need to replace your paycheck.
Aside from getting the right kind of low-cost life insurance plan, it’s vital that you purchase enough life insurance for your family. If you don’t have enough coverage, and you were to pass away, your family could have additional expenses that they have to pay for, but they don’t have the money to pay those bills. Making a few simple calculations could ensure that you have a large enough life insurance plan.
Evaluating the Type of Life Insurance for Your Specific Needs
In deciphering the type of life insurance that will best fit your needs, the two primary categories to choose from include term and permanent. Each of these has both a standard and no exam option and will have both advantages and possibly some drawbacks as well.
Term life insurance is considered to be the most “basic” form of life insurance coverage that is available in the marketplace today. Because term life provides only a death benefit, without any other “bells or whistles,” the cost is typically low. As a low-cost life insurance product, term life insurance can be affordable for many consumers.
However, term life is also considered to be “temporary” coverage. This is because term life insurance is purchased for a certain length of time, and then the policy expires. For example, term life can be purchased for lengths of anywhere from 1 year up to 30 years, depending on the insured’s age and health status.
There are many people who opt for this type of policy – primarily due to its low cost, and the ability to purchase a higher amount of death benefit than can be bought with permanent insurance for the same dollar figure.
Another feature that may be considered on a term life insurance policy is a return of premium rider. Although it can raise the premium somewhat, it can provide the policyholder with the ability to receive his or her premiums back if they remain alive at the end of the policy’s term. With this rider, the policyholder can receive a return of their premiums – essentially making the cost of their life insurance free throughout the course of the years.
Permanent life insurance provides death benefit protection for the entire life of the insured – as long as the premiums are paid and the policyholder does not cancel the policy. This type of coverage also includes a cash value component that allows the funds inside of the account to increase on a tax deferred basis. These funds can grow tax-deferred, meaning that there are no taxes due on the gain until the funds are withdrawn. Because of this, the cash can essentially grow exponentially over time – and it can be withdrawn or borrowed by the policyholder.
Even though permanent life insurance offers fixed premiums throughout the entire life of the policy, these premiums will typically start out higher than those of a comparable term life insurance policy. This is due primarily to the fact that a portion of the permanent life insurance policy’s premium is going to fund the cash value component. Many permanent life insurance policies may also include a “surrender” charge if the policyholder cancels the policy within a certain number of years. This can cause a financial loss to the individual.
Also, many permanent life insurance policies may also have other charges and fees, such as investment fees and commissions. In some cases, these fees can take away as much as three percent per year from the cash-value component of the policy.
Other Advantages of Owning Low-Cost Life Insurance Coverage
In addition to offering protection to ones loved ones and survivors, owning a low-cost term life insurance policy can also offer protection for business owners as well. Used as a way to fund a buy-sell agreement, the death benefit from a low-cost term life plan can help to ensure that a business is able to continue its operations and will not have to be sold if the owner should pass away unexpectedly.
This can be a benefit to the business itself, as well as to its employees who can continue to count on income from the business to support their families. It is certainly a benefit to the company’s customers as well. If you’re the owner of a business, if you were to pass away, your family would suffer, but your business would suffer as well. Having quality life insurance will ensure that your business doesn’t go bankrupt if something tragic were to happen to you. Life insurance gives the organization they time and resources that they need to get through the difficult time and find replacements for all of the different tasks.
Taking the Next Step in Purchasing Low-Cost Life Insurance
If you are ready to take the next step towards purchasing a low-cost life insurance policy, we can help. We work with many of the top rated life insurance carriers in the industry today, and we can assist you in comparing policies, benefits, and premium quotes. We can get you all of the important information that you need prior to making your decision – and we can do so quickly, easily, and conveniently, directly from your home computer, and without the need to ever meet in person with a life insurance agent. If you are ready to begin the process, fill out the form on this page to get your initial quotes.
Should you have any questions regarding life insurance or how to obtain premium quotes, we are here to help. Our experts can help to walk you through the life insurance quote process so that you can be sure to come up with the low-cost life insurance policy that will fit your specific needs the best. To contact us directly, please call 855-900-5499 toll-free.
We understand that shopping for life insurance can sometimes seem overwhelming and that it isn’t something that people want to discuss every day. That’s why we want to make the process as simple and fast as possible. Our experts can get you through the quoting and application process, ensuring that you get the product that will protect those whom you care about, at a price you can afford. Contact us today – we’re here to help.
You never know what’s going to happen tomorrow, which means that you shouldn’t wait any longer to get the life insurance protection that your family deserves. If something were to happen to you, and you didn’t have life insurance coverage, you could be left with a massive amount of debt and unpaid expenses. Those bills could make an already difficult situation a thousand times worse. Instead of leaving your family with a mountain of debt, get an affordable life insurance plan that will give them the money that they need.