Common Questions

Why do I need life insurance?

  • Life insurance can offer you some reassurance that the people you love will be taken care of if a tragedy strikes. Payouts are tax-free, so that’s one less thing they will need to worry about.

What is the difference between the types of life insurance?

  • Term life insurance covers you for a length of time, and is generally the most affordable type of life insurance. If something happens to you within the term (10, 15, 20, or 30 years), your beneficiaries will receive the payout benefit. There are other types of insurance for people seeking life-long coverage, but they tend to be more expensive than term life policies.
  • Permanent life insurance is a policy that covers you for your entire life, and usually builds “cash value” over time. There are three types of permanent life insurance policies:
    • Whole life insurance builds value based on a set schedule. You’ll know the exact cash value of your policy at each anniversary. (If you take a loan or make a withdrawal from your policy, the cash value and death benefit will decrease.)
    • Universal life insurance earns a fixed interest rate on the cash value of the policy. While the interest rate may change over time, it will never dip below a guaranteed minimum rate.
    • Variable universal life insurance lets you invest your cash value in the stock market, so your policy value goes up or down based on the performance of your investments. The investment subaccount options in VUL policies are not offered for sale to the general public.

How do I decide on a coverage amount?

  • Think about the amount of coverage you need and the lifestyle you want for your loved ones add up the balance of your mortgage, your credit card debt, and the amount you want to leave your beneficiary (for things like paying for college or paying off loans), then subtract your current savings.

Is the life insurance policy I get through work enough?

  • Keep in mind that employer policies generally don’t move with you if you change jobs, and go up in price as you age.  Many people are surprised to learn that the life insurance included as part of their benefits package is only one or two times their salary.  For most people, this amount does not cover their needs.

Determining the right insurance coverage for your needs is an important decision.  Book a consultation today to learn more.

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