Types of Life Insurance

Life Insurance Basics

There are many types of life insurance to ensure that your family and loved ones are protected against financial difficulties in the event of a premature death. Combined with investments, retirement and estate planning, an insurance policy is a fundamental part of a sound financial plan. By getting your insurance online you are making an intelligent and caring financial decision for your family.

Types of Life Insurance to Protect Family, Assets and Business.

No matter the type of insurance, our experienced and licensed professionals will help you develop a complete plan that will protect you, your family, assets and business.

When you're young, single and relatively carefree, a life insurance policy may not be something you think much about. But if you find yourself with a spouse, a mortgage and children, having life insurance should become a critical part of your financial future. Knowledge is the key, however, to figuring out and providing adequate coverage.

Certainly, we can't predict the future. But there are steps you can take to prepare for it. Having an insurance policy is a tool that enables people to guarantee the financial security of those they love. At designbenefitsgroup.com our representatives are committed to helping you find the right life insurance policy for your particular needs! To get instant quotes for term life or return of premium insurance just click the instant quote boxes on the right. If you would like to receive a quote for whole life Insurance or universal life, just click those quote boxes on the right. If you would like to speak with one of our representatives, call us at (866)-709-7283 or email us at safewayfinancial.com.

What is Term Life Insurance?

TERM LIFE INSURANCE DEFINED

Term life insurance is for just that, a set amount of time.10, 20, 30 years. If you think about it, car insurance is term insurance. You pay for it for one year and then it is renewed. Same thing, home insurance is term insurance as well. You have a one year term on it and when that term is up you start paying for another year with new rates.

Term is simple. You pay a premium for a period of time (the term) from one to thirty years and if you die during that time the insurance is paid to the person or persons you designate to receive it ý called the beneficiary(ies).

Term life Insurance usually has the lowest premium in the early years, making it the most affordable life insurance - initially. Term does not build cash value.

It covers you for a specified period of time (usually from 5 to 30 years, you choose). If you purchase a $1,000,000 term life insurance policy for 20-year period and you die in any of those 20 years, your beneficiary receives the million dollars.

If you are still living at the end of the term, your insurance policy is over unless you can renew the policy. When you renew (assuming your policy has that feature) it will renew at a higher price reflecting your now older age. Term insurance has no buildup of cash as with whole life insurance. Some term life insurance policies do offer a return of premium. See section on Return of Premium

We are committed to making it as easy and convenient as possible for you to purchase quality, low-cost term life insurance for you and your family and to helping you make intelligent choices regarding your insurance choices.

You can instantly compare hundreds of term insurance quotes from top rated insurance companies. Our online search engine will provide you competitive insurance rates from the highly rated insurance companies for comparison.

Itýs easy. You can get your insurance quotes right on this site, anonymously. Youýll see the prices instantly and can then choose the insurance company that fits your needs. Then you click the ýapply nowý button and weýll help you set it up.

To start the process, click the button on the right side of this page for the type of insurance policy that you want to quote.

You may also contact us by email at safewayfinancial.com with any questions or call us toll free at 866-709-7283

Whole Life Insurance Policies:

What it is. How it works.

Whole life is a type of permanent life insurance. It's called permanent because a whole life policy provides life-long protection and is guaranteed to do so by the insurance company. With whole life, you pay a fixed premium for life instead of the increasing premiums found on renewable term life insurance policies. Since the word term in term life insurance means a period of time one could say that the term for whole life insurance is the term of all of your life. It is not technically called lifetime term insurance, but in a way it could be described that way.

How long does it last and should you get this kind of insurance?

With whole life insurance policies, as long as you pay the premiums, the death benefit will be paid. These policies are designed and priced for you to keep over a long period of time. It's important to remember that if you're not sure that you're going to keep this kind of insurance policy then it's probably the wrong type of insurance for you. In that case, you should look at term life insurance. The biggest difference between whole life insurance policy and the different types of term policies is that whole life insures something that will unfortunately happen for certain; oneýs death. Term insures the possibility of you dying during the term period, whether that is 1 year or up to 30 years depending on the type of term insurance you get.

Whole life also has a cash component. This cash value can grow and interest is credited to the cash value. Interest growth in these policies is tax-deferred. You don't pay taxes on the growth. If you die, your beneficiary also does not pay income taxes on the benefit received. If you cash in the policy and you receive back more than you put in, you pay income taxes only on the amount above what you put in.

There are differences among these policies. Some of these policies are from mutual life insurance companies which mean that the insurance company is owned by the policyholders. Mutual company policies can pay dividends to the policyholders which can both enhance cash values and increase the insurance amount. Your designbenefitsgroup.com representative can show you comparative quotes from different highly rated insurance companies. Another type of whole life is Survivorship life insurance, which is a type that covers two people and pays the insurance amount when both people have died. This is used often in estate planning to create cash to pay the estate taxes.

We look forward to answering your questions on this subject. Call us toll free at 866-709-7283, email us at safewayfinancial.com or go right to a quote request form.

Universal Life Insurance Policies:

A Universal life insurance policy is designed to provide lifetime insurance protection.

This type of insurance policy is one type of permanent life insurance. With a permanent policy, the insurance is designed to last as long as you pay the premiums. Whole life insurance guarantees this lifetime protection. Universal life does not have these guarantees but there are now universal life policies where you can add a feature that guarantees that the insurance will last the rest of your life. We can tell you more about that and give you quotes for this by clicking the link for quotes on the right.

Permanent insurance policies are designed and priced for you to keep over a long period of time. If you don't intend to keep the policy for the rest of your life, this may be the wrong type of insurance for you. If so, it may be better to consider term life insurance or return of premium insurance.

The two main types of permanent life insurance are whole life and universal life. These have a feature known as cash value or cash surrender value. Term insurance policies do not have cash values.

Universal life (or whole life) covers an event that's certain to happen; one's death, while term covers you for the possibility of you dying during the term period.

A term life policy is sometimes renewable (you can keep it but at a price that reflects your older age). At some point, as you get older term goes up in price and may become too expensive for you to keep.

Return of Premium Life Insurance (ROP Term):

Return of premium life insurance is a newly introduced term life insurance policy that provides both death benefit protection and a return of premium insurance feature. It's simple to understand: If you keep your policy for the term period, at the end of that time whether 15, 20 or 30 years, the life insurance company that issued the insurance with the return of premium policy returns the entire premium that you paid for the insurance. There also is some partial return of premium for policies canceled before the end of the term (depending on the year it's canceled and the longer it's kept, the higher the amount of the return).

Return of premium life insurance is aimed right at one of the greatest objections to traditional term life: I am probably not going to die, and my money will have been wasted." When you buy insurance with a return of premium option, you do not have to waste your money. Unlike regular term policies, Return of Premium term life insurance rewards you for living by offering a guaranteed return of your total cumulative premium paid on the policy during the level term period, not including substandard (extra charges for health) and rider charges (extra benefits such as disability coverage), if any, which will be paid to the policy owner at the end of the level term period if the policy is then in force.

Here's an example: Male, age 35 with the best rate of preferred plus, $500,000 of 30-year return of premium term life insurance:

Annual premium = $810; Return of Premium after 30 years = $24,300

($810 x 30yr = $24,300)

The life insurance return of premium is also income Tax Free, because you arenýt receiving back more than you put into the return of premium life policy.

The return of premium term life insurance policies feature fully guaranteed level premiums for the first 15, 20 or 30 years and in some cases the life insurance can continue to age 95.

A term life policy is sometimes renewable (you can keep it but at a price that reflects your older age). At some point, as you get older term goes up in price and may become too expensive for you to keep.

Mortgage Life Insurance

Mortgage protection life insurance is simply insurance that is meant to pay off your mortgage in case of your death while the mortgage is not fully paid.

The original type of mortgage life insurance followed the amount of the mortgage balance so as your mortgage obligation decreased, so did the amount of insurance. Today it usually makes more sense to get mortgage life insurance equal to the original mortgage amount but simply get the most inexpensive level term insurance. Recently it has become more common to buy return of premium policies for mortgage term life insurance. The reason this type of insurance is used is that currently traditional mortgage life insurance rates are not as competitive as most term life rates. The most affordable is the level premium, level benefit term life policy. This type of insurance can be purchased for a period of time such as 30 years, 25 years, 20 years etc. The policy amount is guaranteed not to decrease and the premium can be guaranteed for the full period of time.

Traditional mortgage protection life insurance is occasionally still marketed by banks and some agents.

Return of Premium Insurance to cover your mortgage

Another method becoming more and more popular is Return of Premium Term Life Insurance. This type of life insurance is term insurance with the added and unique benefit that when you keep it for the full term (20 years, 30 years) you get all your premiums back, tax free!

Using this method, the insurance will be there to pay off your mortgage but in the likelihood that you live and you keep the policy, the insurance company guarantees to return all the money that you paid on the policy and since it's considered a return of what you put in, it comes back tax free. This kind of mortgage term life insurance can be more appealing since it is likely that you will live to the end of the term period.

This money that comes back to you on a return of premium life insurance policy is money that you can use to enhance retirement, take a trip you dreamed about or just enjoy any way you please.

Survivorship Life Insurance:

An Estate Planning Solution and Estate Planning Tool

Survivorship Life Insurance, also known as Joint and Survivor Insurance or second to die life insurance, are Insurance policies that insure the lives of two people, typically a husband and a wife.

The death benefit is not paid to the beneficiary until the death of the second insured. These survivorship life insurance policies are generally available as either whole or universal life policies, and second to die life insurance often provides more affordable life insurance than two separate policies.

The reason a survivorship life insurance policy doesn't pay until the second person dies is that it is designed to pay or assist paying for estate taxes. Estate taxes can be delayed until both spouses die thus the design of these special insurance policies.

Joint Survivorship life insurance policies are effective tools often used by wealthy individuals in estate planning. By removing the proceeds of a life insurance policy through the use of gifting and placing policies in third party ownership such as a trust or in the name of children, a joint and survivor policy can be used to pay for estate taxes. Careful planning by your tax and legal counsel, coupled with a properly structured second to die life insurance policy, can help you preserve your net worth for your heirs.