Lead Consultant
Jed Maslowski
AZ License 134466 |
About Life Insurance
In it's most simplistic
form, life insurance can be broken down into two broad categories,
defined as Term Insurance and Permanent Insurance.
Both plans have certain pros and cons which need to be considered
when making your decision. See below for more details.
Business owners may want to consider key person life insurance
for those employees who are vital in keeping your company running
smoothly. Multiple Business owners will need to verify that
their Buy/Sell agreement is properly funded in the event of
an untimely death of one or more of the business partners. For
more information regarding business insurance options, please call
or email us directly. See the
Contact Us
page for details. |
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Term Life Insurance
Term life insurance is coverage that is based on a certain time frame, or term.
For example, most policies have a term length between 10 – 30 years. A
person who is 26 years old, and purchases a "20 year term policy"
will own that policy until age 46...or 20 years. Look at
the chart below for additional advantages and disadvantages.
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Inexpensive.
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For most policies, the premiums are guaranteed for the
length of the term.
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Return of Premium (ROP)
policies are now widely available, which returns ALL premium
dollars to the insured at the end of the term length.
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Once the term is completed,
the policy is terminated, and all premium dollars are lost
(assuming policy is not ROP).
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When policy term is expired,
the renewal
of policy is not guaranteed, and if the policy is renewed, the premiums
will be more expensive.
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If the insured dies AFTER the term
policy
expires, the beneficiary receives $0 in benefit.
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Underwriting requirements
can be lengthy.
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Permanent
Life Insurance
Several types of permanent
insurance products are available, and are generally categorized into
Whole Life, Universal Life, Indexed Universal Life, and Variable
Universal Life.
Permanent insurance, if set up correctly, is a policy that will last your entire life, assuming
all necessary premiums are paid. Look at the chart below for advantages and
disadvantages.
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The beneficiary is guaranteed to receive a
financial death
benefit (assuming the policy is set up correctly during the initial
application) when the insured dies.
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Some policies have a cash value that grows inside
the policy. The owner of the policy has the ability to use this
cash when he/she feels it necessary (as opposed to term insurance,
where the policy has no financial value to the insured).
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Flexible premium payments.
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Typically, less stringent underwriting
requirements than a term policy.
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