Life Insurance
The Value of Life
Insurance
Assessing Your Need
Types of Life Insurance
Life insurance is a crucial step in planning for your future and
the future of your loved ones. It can fulfill promises made to your
family if you are no longer around by providing a death benefit to
your beneficiaries in return for premiums paid to the insurance
company. Life insurance can also provide benefits while you are
living.
Advantages of the Death Benefit
•
Provides income tax-free money to your named beneficiary(s) that
can be used to pay funeral expenses, debt, tuition, estate taxes or
virtually any financial need you leave behind.
•
Can provide business security by enabling partners to buy out the
interests of a deceased partner and prevent a forced liquidation.
Advantages of Living Benefits
•
The cash value growth of a permanent life insurance policy is
tax-deferred(1), which means you do not pay taxes on the growth of the
cash value unless the money is withdrawn.
•
Loans(2) or withdrawals can be taken against the cash value of a
permanent life insurance policy to help with expenses, such as
college tuition or the down payment on a home.
(1) Accumulated growth may be taxable upon withdrawal. If the policy
is a Modified Endowment Contract (MEC), tax penalties may apply
prior to age 59 ½. Consult a tax advisor on your specific situation.
(2) Policy loans and withdrawals reduce cash value and the death
benefit and may be subject to other charges outlined in the
contract.
Back to top
The amount of life insurance you select should be dependent on
your personal and financial needs. We can assist you in determining
an appropriate coverage amount and help you decide on which type of
life insurance is right for you.
Generally, you should consider life insurance if you have:
•
A spouse
•
Dependent children
•
Aging parents or a physically-challenged relative who depends on you
for support
•
Retirement savings that is not sufficient to ensure your spouse's
future financial well-being
•
A sizable estate
•
A business
Life Changes — So Should Your Policy
As events happen in your life, your life insurance coverage may
need to change to adapt to your current needs. Some life changes
that may require you to reevaluate your coverage include: marriage,
divorce, a new baby, purchase of a new home and retirement.
There are several different types of life insurance products
available. The most common include:
Term Life Insurance
Term provides life insurance protection for a specified period
of time. If you do not currently have life insurance, term can be a
good place to start. It's generally less expensive than permanent
life insurance, and is available in varying term periods with fixed
premiums from a one- (annual renewable term) to 20-year period
(level term). Furthermore, term insurance is sometimes convertible
to permanent coverage, providing you with flexibility as your needs
change.
Whole Life Insurance
Whole life is a form of permanent life insurance that remains in
force during the insured person's lifetime, provided premiums are
paid as specified in the policy. Whole life insurance can build cash
value.
Universal Life Insurance
Universal life is a form of permanent life insurance
characterized by its flexible premiums, flexible face amounts and
unbundled pricing structure. Universal life can build cash value,
which earns an interest rate that may adjust periodically, but is
usually guaranteed not to fall below a certain percentage.
Need a Life Insurance Quote? Click here!
We are licensed in the state of Connecticut