Life Insurance
Get Instant Life Insurance From Cresley Pierce
No one really wants to think about life insurance. But if someone depends on you financially, it’s a topic you can’t avoid. Getting life insurance doesn’t have to be hard (or boring). We have some answers to common questions about life insurance so that you can make informed decisions about protecting your loved ones financially.
How much does life insurance cost?
The cost varies based on your unique situation. The biggest factors that can affect your
premium include:
• Your coverage amount and term length: Less coverage and shorter term lengths cost less.
• Your age: Younger people typically have lower rates.
• Your health status: Healthier people typically have lower rates.
• Your tobacco use: Non-smokers typically have lower rates.
A 10-year term life insurance policy with a death benefit of $1,000,000 for a non-smoker at age 25 is $58/mo and at age 45 it is $135/mo.
What’s the difference between term and whole life insurance?
Term life insurance uses premiums to cover you for the determined “term” of the policy. Coverage expires if there is no claim within that time frame. Term life can be a good match for someone seeking affordable coverage to replace lost income over a critical period, such as while raising children or paying off a mortgage.
Whole life insurance lasts your entire life if premiums remain current. Whole-life policies also have the potential to accrue cash value, depending on the policy. For these reasons, whole life insurance premiums are typically higher than term premiums for the same coverage amount.
What if I already have life insurance through my employer?
Employer-sponsored policies typically offer coverage that is about 1-2X your annual salary, which is a fraction of what most families need. And if you leave your job, that coverage usually ends. A common rule of thumb is to have 10X your salary in life insurance protection, which is why many people buy individual term policies to supplement their coverage through work.
How much life insurance do I need?
A common and easy way to come up with a coverage estimate is to multiply your annual income by 10. Another way is to calculate your long-term financial obligations and then subtract your assets. The remainder is the gap that life insurance needs to fill.
What does life insurance cover?
Your life insurance can help cover some of life’s biggest expenses if you pass away while the policy is in force. For instance, policy proceeds are often used for mortgage payments, debts, tuition, and everyday expenses. Ultimately, it’s up to your beneficiaries to decide how to use the payout. Proceeds are paid in a lump sum and are generally tax-free.
Index UL with an Exit Strategy
Dealing with actual performance that does not meet the sales illustration or expectations is all too familiar to those who have sold and purchased many types of life insurance. Declining dividend rates in Whole Life. Market performance that didn’t materialize in Variable Universal Life. Index cap and participation rates that were unsustainable in Indexed UL.
That doesn’t make any of these products inherently inferior or inappropriate. It does, however, point out that they can lack the flexibility needed to manage varying economic conditions.
We’ve changed how we approach accumulation sales to address this issue head-on, putting you back in control of life insurance assets without giving up the downside protection that makes IUL so appealing. Drop me a note or give me a call if you want to take a closer look at how we’re designing this strategy with other clients.
Life Insurance Awareness Month
While it's encouraging that three out of four Americans have some form of life insurance, 30% rely solely on group life policies, which may not adequately cover their needs in times of uncertainty.
