This article explores the five most harmful life insurance myths that still prevail. Even educated professional often find they have to debunk persistent insurance myths that have been the root of many poor and even harmful consumer decisions. Listed below is an examination of some of these myths and misconceptions we face every day.Read More →
Each Universal Life insurance policy has two parts; the first part is the cost of insurance. This is the cost of term insurance for the current year of the policy. The second part is the cash value. When you make a payment to your Universal Life policy, the amount you pay that is in excess to the term insurance cost is credited to your cash value. That cash value grows tax free and can be accessed at any time for any reason you choose.
There is one particular type of fixed Universal Life policy that has become the life insurance product most in demand in the United States; the Indexed Universal Life insurance policy.
With the indexed Universal Life policy, the cash value has two growth components; a minimum growth rate and a growth rate pegged to the positive years of an index. The most common index used is the S&P 500. There are other indexes available, but for the sake of brevity we will only use the S&P 500 equity index as an example. The Indexed Universal Life policy is in such demand that it accounts for 38% of the entire life insurance market in 2013.Read More →
Whole life insurance is a permanent insurance; which means it will continue to insure you for your life time as long as you pay the premium. The premium never increases and the benefit never decreases. Like all insurance policies, the best time to purchase whole life insurance is when you are young and healthy. Doing so will lock in a low insurance rate for your entire life. It will also allow the policy the time it needs to compound your cash value without taxation into a serious nest egg.Read More →
Term insurance is a great tool to insure against the financial consequences of a premature death for a limited amount of time. Examples of needs that may be ideal for term insurance include a mortgage or other major loan payment and dependent children. Your financial obligation toward your children ends once they are out of college and live on their own. While the exact time period is different for every family, unless there is an underlying disability issue few people expect to be supporting their children well into adulthood. Similarly, mortgages and other major debts will typically have a finite period. Eventually the debt is paid off and the need to insure that expense against a premature death expires. Mortgage protection insurance can be either term or permanent depending on the consumer need and budget. Term insurance vs. cash value insurance should both be considered.Read More →