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TRADITIONAL LIFE INSURANCE

TYPES AND CHARACTERISTICS

 

There are many variations in the types of life insurance plans that are available today.  The key is to choose the type and diversity of benefits that best suit the unique needs and purpose for the insured and their survivors.  The most recognized types of coverage are the following:

  • Term Life

  • Permanent Whole Life

  • Final Expense Life

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Each of these serve a specific purpose in your Life Plan,  In many cases, a combination of one or more of these plans in conjunction with other tools such as the indexed Universal Life Policies can be combined to provide a comprehensive program of protection and living benefits for your survivors while contributing to your wealth accumulation program.

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There are also other variations of the above-stated types such as Universal Life and Juvenile Life.

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Sterling Secure works with numerous premier life insurance carriers in the industry so that our clients get the best value at the lowest possible costs. 

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Find out more!

Call Sterling today!

612-819-2460

 

TERM LIFE INSURANCE

 

General Features

  • Provides a fixed amount of as death benefit is fixed for the period of the term (e.g., 10, 15, 20, or 30 years)

  • Premiums are fixed for the period of the term

  • Usually includes a terminal illness benefit

  • Least expensive life insurance while in-force

  • Premiums rise steeply on renewal (based on age)

  • Conversion to permanent life insurance before age 65 without proof of insurability may be available

  • Return of Premium (ROP) may be available if insured lives to term – Increases fixed premium substantially

  • Protected from external forces

  • Policy owner has total control

  • Payment of death benefits to beneficiary is usually tax-free

 

Typical Usage

  • Protect survivor benefits for coverage of short-term debt (e.g., mortgage, college debt, credit cards, other loans, etc.)

  • Protect survivor benefits for lost income for a discrete period

  • Business Key Person coverage

  • Business Owner cross-purchase buy-out coverage

Permanent Whole Life Insurance

 

General Features

  • Death Benefit is fixed through age 100

  • Premiums are typically fixed through age 99

  • Usually includes a terminal illness benefit

  • Generates a cash value with interest (typically 2.5% to 3:0% per year)

  • Protected from external forces (i.e., Does NOT lose increased value)

  • Owner has total control

  • Premiums usually higher than term life insurance

  • Payment of death benefits to beneficiary is usually tax-free

 

Typical Usage

  • Provide survivor benefits

  • Provide longevity benefits

  • Cash savings reserve – Living benefits that can be used to meet financial obligations (typically tax-free interest).

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Availability of Term and Permanent Life Insurance

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  • Group plans through the workplace

  • Individual plans through the workplace

  • Individual plans directly from the private market

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An Important Notice About Group Life Insurance Plans Offered Through Your Workplace

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With few exceptions, group life insurance plans provided through the workplace are NOT transferable or portable.  If you leave your employment, you will likely lose your coverage!

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Some individual plans like those offered by supplemental carriers such as Aflac are 100% portable for the individual.

Final Expense Life Insurance

 

General Features

  • Death Benefit is fixed

  • Premiums are fixed through age 100 or less

  • Generates a cash value with interest (e.g., 2.0 % to 3.0% per year)

  • Typically there is a wait period for deaths caused by illnesses (return of premium paid if insured dies within 1st two years)

  • No wait period if death caused by qualified accidents

  • Protected from external forces

 

Typical Uses

  • Provide survivor benefits

Also see:

INDEXED UNIVERSAL LIFE INSURANCE,

The Permanent Life Insurance policy on steroids!

or

Call Sterling today!

612-819-2460

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