Types of Term Life Insurance, Choose the Right One for You! Term life insurance is one of the most commonly purchased types of life insurance. It differs from whole life insurance in that the policy holder pays premiums and is only eligible for the benefits of the insurance during the relevant amount of time the insurance is in effect. For example, a fifteen year term insurance policy will only pay out the death benefit if the...more
Survivorship Life Insurance - What Are Its Uses? The primary purpose of just about any type of life insurance policy is to provide for the beneficiaries of the policyholder once they have passed away. Whether the money is intended to be used to help the surviving members of the policyholder's family continue to live standard they have become accustomed to or to cover the debts left behind by the insured individual, each person must...more
Markets and Uses for Universal Life Insurance When people think of life insurance, they generally automatically assume it is only for end of life monetary benefits to their loved ones in the event of their passing. Although the primary purpose of life insurance is to pay out a death benefit to your family, it can be used for other things. In fact, when set up correctly, life insurance can be an investment vehicle that provides money for retirement or to help you achieve other financial goals. Universal life coverage is a very flexible policy that has a number of uses outside just paying out death benefits.The money invested into a universal life policy can be used in a number of ways. The most common way people use this type of policy is as a guarantee for a loan. Whether you want to start a business, consolidate debts, or make a large purchase, insurance companies and banks are generally willing to allow you to borrow money against the value of your life insurance policy. Since the policy serves as collateral for the loan, you actually may find it easier to borrow money. When you die, the insurance policy will pay off the loan first and then pay the balance to your...more
Characteristics of Single Premium Life Insurance When people think of life insurance, they typically do so in terms of the monthly payments they have to pay over the time frame relevant to the type of insurance they want to purchase. This is generally because most people do not have significant savings, especially the young, and must...more
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...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 into a mutual fund or stocks. When the fund or stock does well, any return you earn will be added to the cash value of your variable life insurance policy.This is the most defining characteristic of this type of insurance policy. Another characteristic is it's similarity to universal life insurance when it comes to the payment of premiums. Policy holders have the flexibility each month to choose whether to pay the minimum premium for that month, pay the maximum amount allowed by the Internal Revenue Code for insurance policies or to not make a payment at all and instead let the interest they earned during that month pay for the premium. You have to be careful here, however. Consistently paying the minimum or not paying the premium at all...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...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...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...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...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