Skip to Main Content

Do You Have Enough Life Insurance?

Tuesday, June 29, 2021

Even if you already have life insurance through your employer, you may be underinsured. If you’d like the security of knowing that you have enough life insurance coverage in place, we can work with you to ensure that there aren’t any gaps in your current coverage protecting your assets is at the center of everything we do.

All life insurance policies are not the same, the best protection for your family and assets are going to vary on your individual needs.

Below are the core life insurance policy types:

  • Term Life Insurance: Term life insurance has a specified coverage period (term), but can usually be renewed or converted into a permanent policy at the end of the term. Premiums are generally affordable initially but can increase substantially when renewed.
  • Whole Life Insurance: Whole life insurance is a type of permanent insurance that offers life-long coverage combined with a cash-value savings component. This type of policy has higher premiums than term life. Premiums remain constant throughout the policy and a portion is invested by the company, which becomes the cash value of the policy. Whole life insurance pays a fixed amount upon death.
  • Universal Life Insurance: Universal life insurance is another type of permanent insurance policy that combines term insurance with the ability to earn interest on the cash value, paying a market rate of return. Cash value grows tax-deferred and can be withdrawn or borrowed from the policy. It is more flexible than whole life insurance as it also allows you to change your premium payments and death benefit, within limits.
  • Variable Life Insurance: Variable life insurance is similar to universal life insurance in terms of flexibility and an investment aspect. However, instead of simply earning interest on the accumulated cash value, policy owners have more control over how to invest that cash. The ability to invest in professionally managed investment options allows for the potential to accumulate cash value while providing death benefits protection. However, there is a greater risk for loss due to this benefit.
  • Key Person Life Insurance: Key Personal Life Insurance is to cover individuals who are essential to the company’s success. This person may be a partner, majority stockholder or an individual with expertise that is unmatched throughout the rest of the company. If this person’s exit from the company is planned, such as retirement or voluntary termination, then you can prepare for the loss and take the necessary precautions to minimize the impact. However, if the departure is unplanned due to a death, disabling accident or quitting on the spot, then the company will be exposed to financial risks.

We can also protect your loved ones by helping you select a secure life insurance plan. Research has shown that only 22% of people have both individual and group insurance and 35% of households would feel adverse financial impact within one month if a primary wage earner died. These compelling statistics motivated us to ask our clients some important questions:

  • Are you the primary source of income for your household?
  • Do you have a mortgage, college loans or other unpaid substantial debt?
  • How would your family support themselves if you died?
  • Could you (or your family) afford tens of thousands of dollars in medical bills and/or funeral costs?
  • Who would have the burden of paying any debt or other financial responsibilities that you leave behind? 

If you have others that depend on you for financial support, part of your smart financial plan should include how you will provide for them in the event of your death. We can help you find affordable life insurance coverage that suits your unique needs and provides for your loved ones when they need it the most.

Material posted on this website is for informational purposes only and does not constitute a legal opinion or medical advice. Contact your legal representative or medical professional for information specific to your legal or medical needs.