Term Insurance? Permanent Insurance?
"A" is for "Always Know What You are Buying"
Below are a few brief explanations of the more popular types of life insurance. Read our Life Insurance Glossary for additional information on life products available in today's marketplace.
There are many variables with each type of product, so when shopping for life insurance be certain that you fully understand the product that you are purchasing prior to completing and submitting your application for coverage.
Another important step is choosing the right company. The company should be in good financial standing and have the ability to pay their claims. There are several independent companies that rate companies (rating definitions) on these factors; their links are below.
"B" is for "Be Aware That Life Insurance Has Many Uses"
Life Insurance Has Many Uses.In the event of the insured persons death it can provide income for a spouse, an education for children, pay final expenses, pay off a mortgage, protect a business partner, provide retirement income, or be used to transfer money to heirs income tax free. Its primary purpose is financial protection, thus if your primary goals are something other than those listed another financial product may be more suitable in helping you attain those goals.
MEA Financial Services works with several companies and has several plans of insurance available to help you meet your life insurance needs.
We offer both group and individual term products and universal life insurance, a permanent life product at competitive prices. Call us for a price illustration at 1-800-292-1950 or complete our online request for quote.
"C" is for "Consider Carefully The Reasons You Should Purchase Life Insurance"
It's an essential part of any financial plan. Most individuals purchase life insurance to replace income lost due to the death of a wage earner in the family and/or to eliminate debt so that their dependents are not burdened. This could mean that family assets would not have to be sold to pay taxes or outstanding debt.
Another important feature of life insurance is that there is no federal income tax on the proceeds paid to beneficiaries.
"D" is for "Did You Provide For Life Insurance After Retirement?"
Many people may not realize that the life insurance coverage provided by their employer may cease at retirement or just don't worry about it as retirement still seems so far away. For some this may be the only life insurance coverage they have. If an employers life insurance plan is convertible at retirement, it is typically to a permanent life insurance product. Permanent life insurance is a higher cost than term, and as the conversion is most commonly available without proof of insurability the cost is further inflated due to the increased risk the insurer bears. These policies are issued at the then current age, which also will account for a higher premium. Additionally these policies may increase in cost each year due to increasing age of the insured.
The convertibility option at retirement can be of critical importance to some as it may be the only option for them due to declining health or other underwriting criteria that would cause them to be ineligible for new coverage. Therefore a conversion option without proof of insurability can be a welcome safety net. However, for those who are still in good health, researching other life insurance options can be cost saving.
Taking the time to find out if your policy is convertible at retirement is worthwhile. You never know when your life circumstances may change to cause you to have a continuing need for coverage.
If you find that your policy is not convertible and you are now in good health, it may be wise to investigate other insurance options. The cost savings to you can be considerable.