Life Insurance
What is Life Insurance?
Life insurance is a contract that provides a financial safety net for your loved ones after you die. In exchange for regular premiums, the insurance company pays a death benefit to your beneficiaries.
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What are the basics?
There are many kinds of life insurance, but they generally fall into two categories: term insurance and permanent insurance.
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Term insurance is designed to meet temporary needs. It provides protection for a specific period of time (the "term") and generally pays a benefit only if you die during the term. This type of insurance often makes sense when you have a need for coverage that will disappear at a specific point in time. For instance, you may decide that you only need coverage until your children graduate from college or a particular debt is paid off, such as your mortgage.
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In contrast, permanent insurance provides lifelong protection. As long as you pay the premiums, and no loans, withdrawals or surrenders are taken, the full face amount will be paid. Because it is designed to last a lifetime, permanent life insurance accumulates cash value and is priced for you to keep over a long period of time.
What are the different types of Life Insurance?
Term life insurance
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A temporary policy that pays out a death benefit if you die within the policy's term
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Often used to cover loans, ongoing financial obligations, or funeral costs
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Typically most affordable option for a large benefit
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Permanent life insurance
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Some types of permanent life insurance include:​
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A policy that pays out a death benefit as long as you pay premiums and keep the policy in place
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Includes cash value that you can access during your life
Final expense insurance
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A whole life policy that pays for medical bills and funeral expenses when you die
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Also known as burial or funeral insurance
Guaranteed issue life insurance
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A type of life insurance that doesn't require a medical underwriting process​
What should I ask my agent?
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What kind of policy should I get?
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How much insurance do I need?
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How long should my coverage last?
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Are my benefits guaranteed?
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What are the exclusions?
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Can I increase my coverage later?
