Life insurance provides a means of financial protection for families at the death of the policy owner and also a means of transferring wealth to the next generation. There are various types of life insurance policies to choose from and which type is best for you will depend on various factors including your age, health, finances, and reason for having a policy. Three main types of life insurance products we offer are term life, whole life, and indexed universal life. Each type has it's own pros and cons which must be considered in making the right decision of which type is best for you.
Term life provides financial protection for a fixed number of years, usually 10, 20. or 30 years, mostly to cover major expenses such as a mortgage. For example, if a homeowner takes out a $400,000, 30-year term policy and passes away during the term of the policy, the beneficiary will receive the $400,000 death benefit to pay off the mortgage and other expenses. Term life policies may include additional benefits such as living benefits to pay out a percentage of the death benefit to the policy owner in the event of certain critical illnesses. It could also include optional riders such as Return of Premium that returns premiums paid if the death benefit is never used or Waiver of Premium that may waive premiums for a certain length of time under certain circumstances.
On the other hand, whole life insurance is considered permanent insurance, meaning it lasts for the policy owner's whole life, no matter what age he/she passes away. Whole Life policies may build cash value and the premiums tend to be more expensive than premiums for Term Life policies. Much like whole life policies, Indexed Universal Life policies build cash value over the life of the policy, usually more aggressively based on the performance of the stock market.