Defining Life Insurance for Taxation Purposes Life insurance is not only a great idea for future planning. It is not only a great idea for investment purposes. It is one of the best ways to shelter yourself from taxes. The money inside a life insurance policy is not taxable. Even if you use the money inside the policy to invest, you will not have to pay taxes on it. You will not have to pay taxes on the returns you get either, as...more
Characteristics of Variable Life Insurance Products Although variable life insurance products pay out a death penalty when the policy holder dies, it can actually be looked at as more of an investment vehicle for your cash. Part of the premiums you pay for your insurance can be reallocated to other accounts that allow you to earn returns that add to the value of your life insurance. For example, you can invest part of your premium...more
Corporate-Owned Life Insurance The death of a key employee in a business represents a terrible loss to the corporate family. It can also cause considerable financial loss particularly if the person was a significant owner in the business or was in a position that requires considerable time, effort, and expense to recruit a replacement for. Although it may seem callous to some, taking out a corporate owned life insurance policy on key employees is a good way to ensure that the company is able to recover financial from the unexpected death of highly trained and valued personnel. This type of insurance is also known as key man or key person insurance and is used by corporations and partnerships around the world.Corporate owned life insurance (COLI) is an insurance policy that the corporation takes out on a specific person or, in some instances, a group of people. The company is named as the beneficiary and if the person dies while they are insured, the company receives the death benefit. Typically, this is a variable life insurance policy that allows the company to invest a portion of its premiums into investments accounts such stocks or bonds as well as to allow...more
Life Insurance Tax Treatment No matter what you do, you can't get away from having to pay taxes. This even includes the payout from a life insurance policy. There are a few different ways that the proceeds from a life insurance policy are paid out and each has an accompanying tax situation that must be handled. The policy itself has...more
Evaluating Life Insurance Needs People tend to put off buying life insurance. The main reason may be that they do not want to think about their death. More often than not, though, it is also that they do not know how to evaluate their life insurance needs so that they have enough coverage. There are many things to take into...more
Term Life Insurance - The Pros and Cons A life insurance policy means that an individual has an immediately established estate to leave to their beneficiaries once they pass away. It is of particular importance for the person in a household that is the primary income earner to consider life insurance in order to continue to provide for his or her family after they are gone. Term life coverage is perhaps the most popular type of insurance available but it individual must carefully weigh both the pros and cons in order to determine whether or not this particular type of life insurance is the right choice for them.There are two distinct disadvantages that term life has when compared to other types of policies. The most obvious of these disadvantages is the fact that term life insurance only provides a temporary amount of coverage. As the name implies this type of insurance lasts for a set period of time and then expires. If a person outlives the term and chooses to renew the policy or purchase a new one, they can expect to pay higher premiums especially if their health has deteriorated significantly since purchasing the original policy. This can turn out to be a more...more
Types of Life Insurance - Are They All The Same? Life insurance is a tool that many people use to provide a healthier or more robust estate for their beneficiaries. There are a number of different types of life policies available but...more
Death Benefit Proceeds of Life Insurance - Distribution and Taxation! The taxable nature of death benefit proceeds from life insurance is something that most people do not have a clear understanding of. Most people believe that the...more
Choosing the Right Life Insurance - Making the Best Decision Choosing the right type of insurance policy to meet your needs requires you to have a clear purpose in mind for the policy. If you are interested in simply covering whatever...more
Investment Through Life Insurance - The Basics A life insurance policy can go well beyond simply providing for the beneficiaries of the policyholder after their passing. The right type of policy can actually act as a vehicle for...more
Is Term Life Insurance a Good Investment? - The Facts Trying to decide what type of life insurance is best going to suit your needs can be a daunting and confusing task. There are a myriad of options available and you must consider not...more
Life Insurance - Extra Cash When Times Are Tough A permanent life insurance policy that a person has been paying into for a number of years can provide them with a means to get emergency cash without having to deal with a bank. Not all...more