Life Insurance

No one can replace the loss of a loved one. However, you can make sure that, when someone passes away, it will not cause a secondary catastrophe of financial trauma as well. By implementing the right type of life insurance in the right way, a family can be sure that, if a bread winner passes away, the family’s income will not be disrupted but continue so that lifestyle, housing, food, college, retirement, and other important plans will not be devastated. Similarly, if a non-working parent passes away, a proper plan will ensure that the needed finances will be there to pay for the necessary services in his or her absence.

Additionally, in recent years, life insurance has evolved to the point where, in some plans, one can now take a significant portion of the death benefit while living! In such plans, if one finds out that they have only a year or two to live, have a catastrophic illness or injury, or need long-term care, they can take a vast portion of the death benefit (beyond cash value and dividends) even while living to pay for any expenses they wish! In other plans, if the insured cannot perform two of the six basic functions of daily living or has a cognitive impairment such as Alzheimer’s, they can take all of the death benefit even while living to pay for care at home or in a facility. This can be a tremendous benefit for people in such situations!

There are many types of life insurance plans to choose from:

• Term, which is insurance for a specified number of years and has no investment component;
• Whole life, which is permanent insurance with a fixed premium that has a cash growth aspect through the accumulation of cash values and dividends;
• Universal life, which is a form of permanent insurance with a flexible premium that has an investment aspect through cash values that grow according to an insurance company rate; and
• Indexed universal life, the newest form of permanent insurance, which has a flexible premium and an investment aspect through cash values that can be set up to grow with the markets and go up when the markets goes up but guaranteed never to go down when the markets goes down;

Both universal life and indexed universal life can be over-funded to maximize investment growth. The funds of all of these permanent plans grow and can be distributed on a tax-favorable basis.