Life Insurance That’s The Best Fit For Your Life
Since everyone’s situation and goals are different, our policies are designed differently, too. Depending on what you need, our life insurance can simply be your safety net from the unexpected, or it can be the foundation of a smart financial plan, giving you more financial flexibility for the things that are important during your life like paying for college, growing your business, and having more income in retirement.
At Northwestern Mutual, our advisors base their recommendations on your priorities and what you can affordâso you get only the life insurance you need, and nothing you don’t.
Life Insurance Death Benefits: What You Need To Know
There are a lot of different kinds of life insurance: A policy can be temporary, or last a lifetime. It can have a cash value component or not. But the one defining feature shared by all life insurance policies is a death benefit. Its the primary reason to get life insurance, and how policies are almost always described: when someone says they have a $100,000 policy, it really means they have $100,000 worth of death benefit insurance. This article will tell you more about:
Convertible Term Life Insurance
A convertible term life insurance rider is a term policy that includes a term conversion rider. This is an add-on that lets you convert your policy to a whole life policy a type of permanent life insurance that doesnt expire before the end of the term. Converting a term life policy to whole life can be a good option if you still need coverage toward the end of your term.
When you convert your policy, you could potentially save on some of the costs associated with taking out a brand new whole life insurance policy, especially because the cost of buying life insurance increases as you age. Its also a convenient option as policy conversions usually do not require additional underwriting the process used by insurers to assess your insurance risk that usually requires a review of your health and medical history.
Pro: Convenience it allows you to convert a term policy into a permanent policy in an affordable way
Con: Cost premiums increase after a term policys converted into permanent
Duration: 10 to 30 years, with the option to become permanent
Death benefit: Fixed
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Infinite Banking Life Insurance
Rather than a specific type of policy, infinite banking life insurance is a financial strategy that uses whole life insurance policies that distribute dividends to build wealth. The goal is to increase cash flow by borrowing against an existing policy as opposed to a traditional bank.
The concept, as their supporters make it sound, is easy you open a life insurance policy that generates money, and then take out a loan against your own money. When you pay back the loan, youre basically paying yourself back while the money in your policy continues to gain interest. In reality, infinite banking is more expensive and complex. It implies purchasing some of the most expensive policies on the market, investing large sums of money in a policy in the first place, and paying high commissions and other fees.
Pro: Convenience premiums and death benefit stay level
Con: Cost and complexity infinite banking strategies require large cash values and come with high commissions and other fees
Cash value: Yes guaranteed
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Whole life insurance combines life insurance with an investment component.
- Coverage for life
- Tax-deferred savings benefit if premiums are paid
- 3 variations of permanent insurance: whole life, universal life and variable life include investment component
Term life insurance is precisely what the name implies: an insurance policy that is good for a specific term of time.
- Fixed premium over term
- Outliving policy or policy cancellation results in no money back
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Learn More About The Unique Benefits Of Fiul
Question, what is fixed index universal life insurance? Allianz Answers.
No matter how well you plan for the future, you can’t anticipate everything. And many of the events in life, both expected and unexpected, can affect the financial well-being of you and your loved ones.
That’s why many people buy life insurance.
It provides a death benefit that’s income-tax-free to your beneficiaries and can help ensure your family will be able to maintain their standard of living, help them keep their home or supplement lost income.
Death benefit is generally income-tax-free to beneficiaries
But there are other financial concerns you’ll have as you go through life. Things like potential tax increases, unexpected financial emergencies and the impact of market volatility on your retirement assets. The good news is, some types of life insurance can help with these, too.
One type is called fixed index universal life insurance, or simply FIUL. FIUL policies start with a death benefit that’s generally income-tax-free to your beneficiaries but add in other potential benefits that can help you throughout life.
First among these benefits is accumulation potential for your premium payments after any fees and charges to build value in your policy over time.
This can happen in two ways.
Because no single index allocation performs best in all situations, your financial professional can help you determine which combination may fit your financial goals
Types Of Life Insurance Policies
For the most part, there are two types of life insurance plans – either term or permanent plans or some combination of the two. Life insurers offer various forms of term plans and traditional life policies as well as “interest sensitive” products which have become more prevalent since the 1980’s . In New York State, the Department of Financial Services must approve any life insurance policy before a company can issue it to consumers and New York Insurance Law provides for standard provisions that must be included in every policy.
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What If You Cant Find The Policy Documents
Paperwork can get misplaced. People grow forgetful, or sometimes pass away before giving relatives the information they should have. If you believe you are named as a life insurance beneficiary, check online with the National Association of Insurance Commissioners’ Life Insurance Policy Locator Service, which searches a database of known policies from participating companies. However, not everyone will get an answer: Life insurance companies will respond to the request only if they have reason to believe there is a policy in the name of the deceased, and you are entitled to death benefits as a designated beneficiary, or authorized to receive information.
What Type Of Life Insurance Policies Can Be Sold
In the event that you are wondering as to whether you can sell your life insurance policy or not, then the answer is, yes you can. It is quite likely for an individual to sell his/her life insurance policy in cash to get a life settlement. People who are 65 years or more can commonly sell their life insurance policy as long as the assumed worth of the approach surpasses $200,000. All inclusive life coverage approaches and other perpetual plans like whole life make the best possibility for settlements. However a wide assortment of policy types and qualities are also qualified. Likewise, you can also sell a term life insurance policy for money as long as the approach is convertible into perpetual life coverage.
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Have Questions We Can Help
With such a large amount of options, it can be expected to be a little confused on which policy is best for you. At JRC Insurance Group, our agents do not have sales quotas to meet, theyre just genuine people who want to match you with the best life insurance company possible. We work with 63 top-rated companies, and have no doubt that we can find a company for you.
If you would like to receive an accurate quote based on your age and health, or advice about which type of policy you should choose, give us a call. Toll-free, no obligations: 855-247-9555. Our services are free and there is not cost to apply for coverage. You can also request a free quote below to instantly compare rates from dozens of life insurance providers.
Joint Life And Survivor Insurance
Joint Life and Survivor Insurance provides coverage for two or more persons with the death benefit payable at the death of the last of the insureds. Premiums are significantly lower under joint life and survivor insurance than for policies that insure only one person, since the probability of having to pay a death claim is lower.
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What Happens When A Whole Life Insurance Policy Matures
Most whole life policies endow at age 100. When a policyholder outlives the policy, the insurance company may pay the full cash value to the policyholder and close the policy. Others grant an extension to the policyholder who continues paying premiums until they pass. Others still stop collecting premiums, but keep the policy active until its needed.
How Credit Life Insurance Does It Work
This type of life insurance is usually sold by banks and lenders. If youve ever applied for a mortgage, car loan, personal loan or line of credit, you may have been offered a credit life insurance policy.
For some of these policies, the face value is tied to the balance on the debt. As you pay down the loan, the face value of the policy decreases. When you pass away, the proceeds of the policy pay off the remaining balance. Level death benefit policies are available but tend to be more costly.
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Fully Underwritten Life Insurance
This is a kind of life insurance policy that goes through the full underwriting process, which is when insurance companies evaluate your risk profile based on several factors, including your health history, age, and gender.
A full underwriting process can take an average of five to six weeks. As part of the process, you can expect to complete a phone interview, take a medical exam, and have your motor vehicle and medical history reviewed. Most standard life insurance applications go through a full underwriting process.
Pro: Access to coverage people whod otherwise not get approved through faster application options can get approved for life insurance through a full underwriting process
Con: Time-consuming a full underwriting process can take five to six weeks
Best for: Anyone looking for life insurance coverage whos ineligible for faster options, like no-medical-exam or accelerated underwriting
What Is The Aim Of Credit Life Insurance
Protection of heirs from being saddled with outstanding loan payments in the event of your death is the main goal. It’s especially important if your spouse or someone else is a co-signer on the loan in order to protect them from having to repay the debt. It also protects your spouse or heirs in states where heirs aren’t protected from a parent’s outstanding debts.
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Guaranteed Issue Life Insurance
Guaranteed issue life insurance belongs to a category of policies called burial insurance. Its permanent coverage that’s best for people between age 45 and 80 and those who cant qualify for a standard life insurance policy due to a serious medical condition or terminal illness. Application acceptance is near-guaranteed.
Unlike term or whole life insurance, the application for guaranteed issue life insurance doesnt involve health questions or a medical exam. It has a small death benefit, which is meant to help your family cover your funeral costs or medical bills.
Pro: Near-certain approval guaranteed issue provides access to a small death benefit to cover final expenses
Con: Cost high premiums for relatively low coverage amounts
Best for: Seniors or people with terminal illnesses
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What Credit Life Insurance Is And How It Functions
If you die while debt owes on loan, the insurance pays out the remaining sum.
This is wholly different from an insurance coverage that most people are familiar with. If you die, the insurance will pay the loan rather than your loved ones. A conventional life insurance policy might pay money to your child or partner as a beneficiary. With credit life, the reward would go to whoever provided you with a specific debt you hadnt completed paying off when you died.
You pay monthly repayment fees on the insurance plan if you take out a credit insurance policy. The insurance comes in if you die with an unpaid obligation.
In addition, the insurance reimburses the lender for the outstanding loan balance. Some clients purchase life insurance to protect themselves against credit card debt and other types of debt.
The policyholder covers anybody who secures the loan with them . It also protects them from needing to make payments if the insured dies before the debt is paid off. The payoff, or death benefit, is then paid to the lender. The policyholders partner or co-signor is not obligated to make the payments.
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What Type Of Life Insurance Is Credit Policies Issued As
If you perish while the plan is active, your insurance company will pay your borrower a death benefit. Credit insurance coverage is a kind of credit insurance that incorporates other financial products that pay off your debts if you become unable to pay them. This operates similarly as unemployed, or illness credit insurance does.
What Are Some Of The Benefits Of Having Credit Life Insurance
There are many benefits to having credit life insurance, including peace of mind, protection for your family, and financial security. Credit life insurance can help pay off your debts in the event of your death, so your family is not left with a significant financial burden. It can also help pay for funerals and other expenses. A term life insurance policy can provide coverage for a specific period of time, usually 10-20 years. This can be beneficial if you are young and have a family that depends on your income. Whole life insurance policies provide coverage for your entire life and can build cash value over time. This can be used as a source of financial security in retirement or for other purposes.
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Monthly Debit Ordinary Insurance Debit Insurance
is insurance with premiums payable monthly which are meant to be collected by the agent at your home. In most cases, however, home collections are not made and premiums are mailed by you to the agent or to the company.
There are certain factors that tend to increase the costs of debit insurance more than regular life insurance plans:
- Certain expenses are the same no matter what the size of the policy, so that smaller policies issued as debit insurance will have higher premiums per $1,000 of insurance than larger size regular insurance policies.
- In some companies, more debit policyholders allow their policies to lapse than is generally the case with policyholders of regular life insurance. Since early lapses are expensive to a company, the costs must be passed on to all debit policyholders.
- Since debit insurance is designed to include home collections, higher commissions and fees are paid on debit insurance than on regular insurance. In many cases these higher expenses are passed on to the policyholder.
- As a general rule the combination of smaller amounts, higher lapse rates and higher commissions and fees on debit insurance tends to make it more expensive than comparable regular life insurance plans.
What Type Of Life Insurance Are Credit Policies Issued As
Majority of the credit life insurance policies are given as a decreasing term life insurance strategy. The top notch remains the equivalent however the inclusion sum diminishes after some time in light of the fact that the obligation is being squared away by the protected. This is a gathering strategy in many examples. Law has it that the organization requiring the extra security on the lender can require the life coverage nonetheless, has no control on which type strategy is utilized. In the event that the one who leased as of now has adequate extra security he/she can dole out a bit of the passing advantage of their own present term or widespread life strategy to ensure installment on the advance if there should arise an occurrence of sudden passing.
It is favored that a term life strategy with a level demise advantage is utilized. Over the long haul in our carries on with our commitments change. On the off chance that you endure, the obligation is paid off and the rest of the assets are given to another recipient. In the event that you bite the dust, enough of the passing advantage is utilized to take care of the rest of the equalization of the obligation and the remaining goes to different recipients or the perisheds bequest.
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Modified Whole Life Insurance
Modified whole life insurance is a type of whole life insurance that offers lower premiums for a short time , followed by a higher rate for the remainder of the policy. The low initial premiums allow you to get a death benefit sooner, but premiums become more expensive rather quickly.
The prospect of saving on premiums at the beginning of the policy may be tempting, but modified whole also known as modified premium whole life is not the best option for most people because of the high premiums and complicated policy options.
Pro: Initial convenience low initial premiums let you get a cash value sooner than standard whole life policies
Con: Cost increasing premiums, making the policy harder to maintain over time
Cash value: Yes guaranteed