Featured
Consumer Help:
How
Much Life Insurance Should You Own?
Rough rules of thumb suggest an amount equal to 6 to 8 times your
current annual earnings. However, there are many other things to consider when determining how much life insurance you need.
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Complete Featured Article Online
A
Beginner's Guide To Life Insurance
Learn
About Whole Life Insurance
|
The
Basics Of Life Insurance |
WHY
HAVE LIFE INSURANCE? The main purpose of life insurance is to cover the survivors of the person who dies. Life insurance can be used to pay off debt, cover burial expenses or take care of surviving children. Life insurance can be very important, especially if you are leaving a spouse that doesn't work, young children, or debts. In the event of your death, the life insurance company would award the amount of the policy to your
beneficiaries.
Most people buy life insurance to replace income that would be lost if a wage earner passed away. Life insurance proceeds are tax-free, so it can also play a role in estate planning, cash accumulation, retirement funding, and the transfer of wealth to
beneficiaries. There are many types of life insurance on the market today. The cost of a policy and
features it offers vary depending on the type of insurance you
choose.
WHAT
DOES TERM LIFE INSURANCE COVER?
Term life insurance covers you for a period of time you select (for example, 10 or 20 years) and pays benefits only if you die during the time you're covered. Term life is often referred to as temporary insurance.
Does not accumulate cash value, which means if you do not die within the time
you are covered, your estate does not collect any money from the policy when it ends.
Most companies offer conversion privileges to permanent policies, which means you can turn your term life policy into a "permanent" one under some
circumstances.
For
more information on the advantages and disadvantages of each
life insurance option, please read the article Life
Insurance Basics
