Fixed annuities are low-risk, making them a lucrat...
This is a follow-up of our original article, Top 7 Frequently Asked Questions About Life Insurance.
Once you have decided to purchase life insurance, it is critical to choose the appropriate life insurance agent, provider, and plan. As you evaluate which company to do business with and which plan to purchase, consider the following questions:
The premiums for your insurance are determined by your policy details, such as the type of policy and the quantity of coverage, as well as your personal circumstances, such as your health, age, family history, and lifestyle choices. The best method to receive the most competitive premiums is to collaborate with an independent broker.
Costs will vary depending on the limits purchased and the type of policy design. As of April 2022, a healthy 35-year-old male can expect to spend around $31.00 in monthly premiums for a 20-year, $500,000 policy, while a 35-year-old female with the same term length and policy value could pay $26.00.
Term life insurance is less expensive than whole life insurance because whole life lasts longer and includes a savings function.
A group life insurance policy is one you purchase through your employer or a member organization. These policies are frequently more straightforward, at least for a smaller amount of coverage. You can have many policies, and group insurance is a simple and cost-effective method to start or augment your life insurance coverage.
There is no waiting time with term life insurance. When the policy is authorized, coverage begins. Whole life policies, which need questionnaires and medical tests, may have a waiting period.
If you want lifelong protection or the ability to build up a tax-deferred cash value, permanent insurance is usually the best choice. A portion of a permanent policy's premium is used to build up a cash value. You can use the cash value in a variety of ways, including taking out a loan against it or using it to pay your premium after your policy is fully paid up.
Term life insurance policies have no financial value. You can borrow money against the cash value of some whole life insurance policies. You can also cash in your policy before you die by surrendering it. If you do this, your beneficiaries may not get a death benefit.
Unless the beneficiary elects to receive the death benefit as an annuity or in installments, the death benefit is paid out as an income tax-free lump amount. There are a few kinds of policies where the premium is paid using pre-tax monies (for example, some employee benefit plans); however, the death benefit may not be tax-free in such a situation.
If you take out a loan against your policy using the available cash value and then pay it back with interest, your policy retains its original worth. The insurance company decides the interest rate and the value of your policy will be decreased if you do not repay the loan.
Your premiums will not change if you have a term or whole life insurance. In other circumstances, inquire with the insurance agent about how the policy may change as you age.
Most life insurance policies have riders available for an additional cost in the event of incapacity or severe sickness, and these riders give optional benefits.
Some good news – life insurance rates are lower than they have been in years, so if you are considering life insurance, now is the time. Working with an agent is the best way to determine your needs, design a policy and shop the market. Your goal should be to obtain the best combination of coverage, price, and services that meet your individual needs.
Protecting your family’s future is a big responsibility, but we can make it easier. When you work with Leap | Carpenter | Kemps Insurance Agency, you can rest assured that just like you’ve got your family’s back, we’ve got yours. We offer the most extensive range of life and health insurance options in the region. Contact us today.
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Leap | Carpenter | Kemps Insurance Agency provides Commercial Business Insurance, Employee Benefits, Life and Health Insurance, and Personal Insurance to all of California, including Merced, Atwater, Los Banos, Mariposa, Madera, Fresno, Modesto, Turlock, and Stockton.
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