Life Insurance

Life insurance is an essential part of financial planning for every family. The essential characteristic of life insurance is that an individual pays a regular premium, usually monthly, to an insurance company and in exchange the insurance company pays to a beneficiary a death benefit. The amounts of the premium and the death benefit are specified in a contract, called the life insurance policy.

Why Have Life Insurance?

Every family plans ahead for normal living costs, college expenses and the like. Life insurance allows the family to make certain there is enough money available for those planned expenses if one or both of the bread-winners in the family die. Insurance can provide enough money so the surviving family members can continue to live in much the same way that they do when all parents are contributing money to the family expenses.

What kinds of Life Insurance are there?

Life insurance policies come with a variety of terms. Term life insurance is the least expensive form of insurance. It is for a specified term with an ending date beyond which the insurance is no longer in effect. Because it is less expensive, you can purchase insurance with a larger death benefit. It is frequently used when a specific expense is known and the benefit is not needed after that is past. If you are concerned about college tuition for one or more kids, for example, a term life insurance policy could make certain the money is there for their schooling but after they have graduated, that need no longer exists. Similarly, if you want to pay off a mortgage, the insurance does not need to be in effect after the mortgage is fully paid.

Permanent life insurance comes in a variety of forms, but the key variable is that there is no termination date in the policy and the death benefit cannot be reduced. Whole life is a common form of permanent life insurance where the premium stays fixed for the life of the insured person and the payment of the final death benefit is guaranteed no matter the age of the insured so long as the premiums are paid. The policy also accumulates cash value which the insured can borrow against.

The terms of these policies can include variations on the increasing cash value, alternate ways for the benefit to be paid out and alternate premium amounts.

How do you find out about life insurance?

We can help you with all of the details related to life insurance for you or other members of your family. Read our up-to-date articles and view a quote to learn how we can help protect your family.