Life Insurance
Life Insurance is...the future delivery of dollars (money) at the time the dollars are needed. I have a wife and 4 children. They have living expenses, college expenses, taxes to pay, and all types of future obligations. Today, these dollar needs are met by my income. If God takes me home today, my income stops! However, the life insurance I own provides the delivery of dollars for the continuing needs of my family.
TYPES OF LIFE INSURANCE
Term Insurance provides a death benefit if the insured person dies during the term of the policy. Terms are 1 year, 3 year, 5 year, 10 year, 15 year, 20 year, 30 year, 40 year, and 100 year term periods. Just like car insurance you are paying for protection and not building up any cash reserves within the insurance policy.
Permanent Insurance (whole life, universal life, interest sensitive life) stays in force until you die. In addition, a cash reserve builds up in the policy that can be used as an emergency savings account or as a financial account that helps in your retirement. The cash growth is a tax deferred growth. The cash in your permanent policy is an exempt asset which means this money is not attachable if a legal judgment comes against you. Your stocks, bonds, savings accounts, money market accounts, CD's, and mutual funds can be attached by the courts, but not your cash value in your life insurance policy.
Paying for life insurancecan be done by you personally and you own the policy, or another person (trust or company) pays and owns the policy on your life. When someone else or something else owns and pays for the policy the death benefit proceeds are kept out of your estate and thus not subject to estate taxes.
Financed life insuranceis the purchase of permanent life insurance using someone else's money. We have lenders who design a finance program that custom fits you.
Keyman life insurance(or Keywoman) is a policy a company purchases on the life of an employee whose existence is very important to the life and security of the company. The policy is owned by the company and the death benefit is paid to the company.