Types of Policies
Term life insurance offers financial protection by providing coverage for a predetermined time frame, known as the "term." During this designated period, if the insured individual passes away, a death benefit is paid out to their named beneficiaries. This type of insurance is often preferred because it generally comes at a lower cost for a slightly higher death benefit compared to permanent life insurance policies, making it a more accessible option for many individuals seeking to secure their loved ones' financial future. Term policies most commonly come in either, 10, 20, or 30 year terms.
Term Life:
Whole life insurance is a specific type of permanent life insurance that offers individuals coverage for their entire lifetime, as long as the premiums are paid. It features fixed premium payments, which remain consistent throughout the policyholder's life, and it also accumulates cash value over time. This cash value can be accessed and utilized during the policyholder's lifetime, in the form of a loan, for various financial needs or emergencies. Cash value loans can either be paid back in installments, or in some cases, deducted from your overall Death Benefit.
Whole Life:
Indexed Universal Life (IUL) insurance is a specific type of permanent life insurance that effectively combines a crucial death benefit with an accompanying cash value component. In this arrangement, the growth of the cash value is intricately linked to the performance of a stock market index, providing policyholders with the opportunity for potentially higher returns and tax free retirement income compared to more traditional whole life insurance policies. Additionally, unlike 401Ks or Roth IRAs, IULs do not participate in market downturns. In essence, IULs go up with the market and remain level with a 0% return when the market goes down. This innovative structure allows individuals to benefit from market gains while still maintaining the protection of life insurance.