Life Insurance
Insurance: [ Universal Life] [ Term Insurance]
What is a Universal Life Insurance Policy?
It is a life insurance policy that offers an individual life protection for his or her family or love ones in the event of his or her untimely death. Furthermore it is a policy that a person can invest into in which a portion of his payments will go to pay for life protection or the cost of insurance, and the remaining portion will go into an investment that earns compound interests monthly.
Who is a good candidate for a Universal Life Insurance Policy?
This policy is good for a person of any age that is looking for permanent insurance protection, flexible insurance payments and a tax deferred saving account.
What are the 4 primary features of a Universal Life Insurance Policy?
- Asset accumulator
- A death Benefit that is tax free
- Competitive interest savings that is tax deferred
- Flexible premium payments
What is a Term Life Insurance Policy?
This is a life policy in which a person pays the premium for a specific period of time. There are two kinds of Term Life Policies: firs, there is an Annual Renewal-Term-Policy. If a person owns this kind of policy, his or her monthly premiums will increase each year. Second, there is the level-Term-Policy. With this kind of policy, the premiums can stay level for ten years, twenty years or thirty years. However, after each of these term periods, the premiums will increase.
Who is a good candidate for a Term-Life-Policy?
This policy is good for a person that needs a lot of life insurance as a low monthly premium that will remain constant for a particular period of time.
What are the primary features of a Term-Life-Policy?
- The death benefit is tax free
- Large coverage for low cost
- Temporary coverage
- Pay premiums for a special period of time
- Mortgage cancellation
The cost and availability of life insurance depend on factors such as age, health, and the type and amount of insurance purchased. Before implementing a strategy involving life insurance, it would be prudent to make sure that you are insurable by having the policy approved. As with most financial decisions, there are expenses associated with the purchase of life insurance. Policies commonly have mortality and expense charges. In addition, if a policy is surrendered prematurely, there may be surrender charges and income tax implications.