top of page

My Site Group

Public·6 members

What Type Of Life Insurance Should I Buy


Navigating through all the different types of life insurance can seem daunting. At Aflac, we want to help simplify your search and guide you toward finding the life insurance policy that best fits your lifestyle.




what type of life insurance should i buy



While there are various life insurance options, these plans tend to function similarly. Whether you have life insurance that lasts your entire life or just 20 years, you must pay regular premiums in order to receive your benefits. Most life insurance plans have a benefit that is paid to the beneficiary when the policyholder passes.


Depending on the type of life insurance policy, there may be other benefits available. Some life insurance plans offer benefits that can be used while the policyholder is still alive. These benefits may come in the form of a cash value component that can be used to help cover medical expenses or everyday costs of living.1


Like its name suggests, whole life insurance is a permanent coverage type that lasts your entire life. The benefit will be paid to your beneficiary whenever you pass. This may be a more expensive option upfront, but the benefits can be more secure in the long run.


Whole life insurance may be the best type of coverage if you are looking for guaranteed support for your loved ones on any timeline. It may also be a wise move if you are hoping to factor in long-term financial planning.


On the other hand, term life insurance provides coverage for a set term or specific amount of time. At Aflac, we offer multiple term lengths in 10, 20, and 30-year increments. This plan may be a more affordable route. However, the policyholder must pass during the designated time frame of the plan for the beneficiary to receive benefits.


There are additional term life insurance considerations to make as well. In some cases, you may be able to extend the length of your term life insurance policy if you outlive the time frame (subject to limitations and exclusions). This depends on your history of payments and the established guidelines of the insurance carrier. Many customers typically compare the costs and values between term and whole life insurance.


How much you are looking to spend on premium payments, how much coverage would you like to secure for your family, and the access to cash benefits are all important determinants to consider when deciding what the life insurance policy is best for you.


Even after learning the differences between each type of plan, it can be confusing to pick the life insurance policy that best meets your needs. Talking to an agent always helps, but there are also a few key factors that can help you narrow down your decision.


If budgeting is your biggest concern, term life insurance may be the best choice. If you have many dependents, whole life insurance may be a better route. However, if financial planning and cash value are most important to you, universal life insurance may be a strong option. Lastly, if you are a business owner, group life insurance might be the best life insurance option.


We recommend you determine which additional elements are non-negotiable for your needs. If cash value is a top priority for you, your life insurance options may start to slim down. Reading the fine print and understanding the benefits within each plan can help tip the scale too.


There are a number of different types of permanent insurance policies, such as whole (ordinary) life, universal life, variable life, and variable/universal life. For more details, see our articles on the specific types of policies.


Every person is unique, and the decision to buy a whole vs. a term policy should be guided by your specific situation in life and the things that matter to you, including (but not limited to) such things as:


If you are an employee, taking advantage of your benefits at work is a smart and affordable way to get the financial protection you want for yourself and your family. Contact your HR department to review your plan details and determine how much life insurance is available to you. Your employer may provide life insurance as a benefit, or you may opt to pay for additional life insurance through payroll deductions.


As with any other financial services product, that depends on your life situation and goals. If you want life insurance protection that lasts your entire life, then a whole life policy from a solid provider is a great choice for your needs. It can also be a worthwhile investment for older people concerned about estate planning and minimizing the effects of taxes for their heirs.


Generally speaking, when a term life policy comes to the end of its term (or effective period) you either have to buy another policy (at a higher cost) or go without life insurance. One exception: If you have a term policy with a guaranteed renewal clause, that will allow you to renew at the end of your term on a year-by-year basis, typically at a far higher rate. While expensive, it can be worthwhile if your health has declined or you are otherwise uninsurable.


With the cost of college on the rise, your child may appreciate having the ability to borrow money against the cash value of a life insurance policy to help pay for their education. Your child could also tap into the insurance policy to help make up a down payment for a first home or to pay for a financial emergency.


If your kids have long since left the house, you might not feel the need to pay for an expensive life insurance policy. But it may still be worth considering taking out a small policy to help your family pay for your funeral expenses.


As we noted earlier, whole life insurance is one type of cash value insurance, which combines a death benefit with the ability to accumulate cash over time. Here are some other types of cash value insurance you may want to consider.


Who is it for: Term life insurance is ideal for people who want life insurance coverage for a specific debt or situation. For example, some people buy it to cover their working years as income replacement for their family in case they pass away. Some people buy term life to cover the years of a mortgage or other large debt.


How it works: Whole life insurance can provide coverage for the duration of your life. An account within the policy builds cash value over time by using part of your premium payment and adding interest. A policy will have built-in guarantees that the premium will not increase, the death benefit remains the same, and the cash value will earn a fixed rate of return.


Who is it for: Universal life insurance can be good for someone looking for lifelong coverage. Some varieties of UL are suited for people who want to tie their cash value gains to market performance (indexed and variable universal life insurance).


How it works: Variable life insurance offers permanent coverage and cash value. The policyholder chooses the sub-accounts in which to invest and those decisions determine how much the cash value account grows. You can also lose money based on the performance of your sub-accounts.


How it works: These joint life insurance policies ensure two people under one policy, such as a husband and wife. The payout to beneficiaries is made when both have passed away. You may see them called second-to-die life insurance, but for understandable reasons the industry is moving away from this name.


Downside: If two spouses are insured and one would suffer financially if the other passed away, this is not the right policy type. The surviving spouse does not receive any life insurance benefits. The payout is only made when both have passed away.


Whole life and universal life each comprise about one-third of market share by life insurance premiums, according to the latest LIMRA figures. Term life is next with 20% and variable universal is at 13%.


Term life insurance allows you to lock in rates for a specific period of time, such as 5, 10, 15, 20 or 30 years. Premiums can be level, annual, renewable or decreasing, depending on the policy you choose.


Permanent life insurance is coverage that typically lasts for your entire life and can build cash value. There are several types of permanent life insurance, including whole life, universal life, and variable life insurance.


When you start thinking about life insurance, odds are that you're thinking about protecting your family, both now and in the future. And that's a great place to start. But life insurance can do so much more. While everyone can benefit from life insurance, you may want to consider one type more than another, depending on where you are at this point in your life.


We're here to help you figure that out. Our personal guidance, flexible options, convenient ways to pay, and history of financial strength make us the company to turn to when you're ready to start thinking about life insurance.


If you're looking for a simple entry into life insurance, this is the best way to go. Term life is exactly what it sounds like: protection for a set period. It's solid coverage, and you can convert your coverage to a more permanent solution if your life changes.


If you're looking for a policy that's guaranteed to grow and is designed to offer permanent lifetime protection this is it. Your policy also provides cash value, which is money that accumulates in your policy over time. Eligible policy owners may also receive an annual dividend, which can help grow the cash value even faster. (Dividends are not guaranteed, but New York Life has paid dividends to eligible policy owners every year since 1854.) Whole life is also something to consider if you'd like the flexibility to supplement your retirement income by accessing the cash value of your life insurance policy.*


Term life insurance is set for a period of time. Once the policy expires, the contract is over and there is no payout. If you want to continue having life insurance, you need to renew or get a new policy.


Permanent life insurance, however, is a policy that you maintain for the rest of your life (unless you cancel it). The level of coverage and the premiums you pay are determined when you purchase the policy and stay the same throughout. Another key difference with permanent policies is that they usually accrue some cash value and some can be also used as investment accounts. 041b061a72


About

Welcome to the group! You can connect with other members, ge...
bottom of page