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Life Insurance

Whole or Term Life Insurance: What Policy is Right for You?

Life insurance is designed to help your loved ones after you’re gone. However you can also use your life policy to pay down debt and build up equity. Insurance companies weigh a number of factors in to decide what policies to offer you.

What is life insurance?

Life policies are set up to pay your beneficiaries money for expenses that occur when you die. Depending on the policy, you can set up certain conditions for your beneficiaries to receive the money.

Why do I need it?

Everyone should have a life policy for their final expenses. A life policy can also help your business continue existing when you die by assigning assets and shoring up the business.

How does it work for me?

This type of insurance work as a buffer to help pay down unforeseen expenses that result in your death. Depending on why type of policy you get and the riders the insurance company places on the policy, your family or whoever you designate as your beneficiary could receive money to pay for a variety of unexpected bills and expenses.

What other types of life policies are there?

Universal life policies work much like whole life policies, but are flexible in that they:
Allow you to change the death benefit received by your beneficiaries
Allow you to change the amount you pay for your premium
Allow you to change the date your premiums are due

Variable life policies differ from traditional whole life policies in that your cash value portion of your policy can be used to “”play the stock market.””

What are the benefits for each type of policy?

Whole life policies cover the insured throughout their lifetime as long as the premium is paid. The death benefit covers final expenses and can cover mortgage payments. The cash value component of this policy can be drawn on during the life of the policy and are tax-deferred.

Term life policies cover the insured for a specific period of time and are often used to pay down debt and save for a major expense. Their flexibility is what attracts clients to these policies.