According to the most recent published survey conducted by LIMRA, it is estimated that more than 50% of U.S. households don’t have enough life insurance. The same study also found that more than 30% of households don’t have any life insurance whatsoever.
Having the right amount of life insurance can help you fulfill your promises to the people you care about, at a time when they need it most. And also, life insurance is an important way to help protect against the unexpected and the most effective way to prepare for the future. Completing our basic needs analysis is a helpful first step in determining the amount of coverage one should consider when deciding to get life insurance.
With many companies offering a variety of products, features, and benefits, choosing a life insurance provider can seem confusing. We can help. The better informed you are about the types of life insurance and coverage options available, the more confidence you’ll have in choosing the most suitable life insurance for your family.
The two most common types of life insurance to consider when deciding to apply for life insurance are Term and Permanent (whole life.) Term life insurance is a very effective way to maximize the amount of coverage at a lower cost for a set period of time. (a term) Typically, these policies may be written for a term of 10, 15, 20 or 30 years. Term life insurance policies may also be written with a level premium, meaning that the annual rate will not ever change for the length of the policy term. Whole Life Insurance is a permanent policy that can build cash value over time and you’re covered no matter how long you live. Plus, you may use the accumulated value throughout your life, i.e. starting a business, college costs, or large purchases. For many individuals and families there can be some very valuable estate planning and tax benefits to owning a permanent insurance policy. Although you do not build equity in a term policy as you would with a whole life policy, the amount of coverage you can purchase for a substantially lower annual premium often proves to be the better value. For example, we mostly advise younger families focusing on maximizing the most income replacement for the least amount of annual premium, to consider term insurance as their best choice for providing family protection within a budget. As needs throughout your life change, you may later opt to convert part or all of a term life insurance policy to a permanent policy or combine the two types of coverage to get the long term security and financial benefits both of these policies offer.
We recommended that you review your life insurance needs with us on a fairly regular basis. Some examples of times you may want to consider reviewing your own life insurance include: getting married, protecting young children, buying a home, starting a business, starting over (divorce), retirement, empty nesters, funding a special needs trust, supporting aging parents, building legacy protection or final expense coverage review.
Feel free to contact our office to review the best options for you and your family.