Insurance Settlement Basics

A life insurance settlement can be defined in a few different ways, but normally it is simply the sum of money that one’s heirs receive after a policyholder passes away. After you responsibly pay your monthly premiums and/or maintain the cash value amount associated with your life insurance policy, your loved ones are entitled to this so-called death benefit payout, or insurance settlement. Then, whether these often-substantial funds are used to pay off your Continue reading “Insurance Settlement Basics”

Whole Term Life Insurance Ideas

When you choose a life insurance policy, your first decision is to pick from term or whole life insurance (or another form of permanent life insurance). Term life insurance is cost-effective and will give benefits to your family if you die but if you fail to die (so to speak), nobody gets anything (except the life insurance company). Whole life insurance will provide coverage for all your life and you can either cash in or borrow against it in case you live through the life of the policy. You get the payout amount or even more because Continue reading “Whole Term Life Insurance Ideas”

Life Insurance Sales Leads

Obviously finding a way to quickly and systematically get high-quality life insurance leads is what it is all about when it comes to life insurance sales. Before the Internet became such a huge force for change, agents employed all sorts of creative and interesting methods to acquire or create insurance sales leads. Direct mail campaigns, educational seminars, or mini events in places where potential prospects might congregate (i.e. a mall) were a few methods commonly employed. Agents still rely on real-world face-to-face meetings for creating rapport and trust as well as a list of callbacks. The Internet however, just Continue reading “Life Insurance Sales Leads”

Difference Between Term And Whole Life Insurance

If you’re not clear on the precise difference between term and whole life insurance, you have come to the right guide on insurance. I promise: by the end of this short article you will be clear.

There a few major differences, so let’s take them one at a time. Term life is insurance that you buy for a limited, defined term. This term could be as little as a year, but it’s usually between 10 and 30 years. Whole life, on the other hand is good for the whole of your life, i.e. until you pass away, or until you reach a very old age as specified in your policy, say 90 or 100 years old. So, the #1 difference between term life insurance and whole life insurance is whether there is a fixed length or term of the policy, or there is not.

The implied rule here is that you know for certain that with a whole life policy you will receive a death benefit payout, as long as you make your premium payments, unless you yourself decide to terminate the policy early, for some reason. With term life you know for sure that you will not get a payout unless you die within the term of the policy. It’s very simple, and note that it’s hardly a question of whether one type or another is ‘good life insurance’: the best policy is the one that make the most sense for you.

The next difference between whole life and term insurance? Let’s look at their investment function, or lack thereof. Term policies have no investment value. You cannot borrow against them and the payout amount is fixed from the start. With whole life, as well as other forms of permanent insurance, you can borrow against the cash value amount that has built up, at an interest rate that is probably going to be lower than credit cards and other loan sources. Now, most unbiased insurance experts at least (i.e. experts not actually engaged in trying to sell you whole life insurance!) will tell you that while whole life might be good life insurance in a generic sense it is not a great investment, but that is the subject of another post.

We just touched on the basis for a big difference between term life and whole life insurance, that of the concept of ‘cash value’. This amount builds up over time, based on interest earned by the premiums that you pay. The idea is that the cash value amount will cover the guaranteed payout that the insurance company is obliged to pay when you die. You may borrow against this amount, but be careful that you don’t overdo it as you may impact the eventual policy payout, which is the reason for buying life insurance in the first place! Also, since borrowing against the cash value is a little like paying the insurance company to borrow from yourself don’t put too much weight on this feature as a reason to buy whole life insurance. Oh yeah: term life does not have this cash value feature. Your death benefit, should your beneficiaries get it, is all that you are owed. It’s a fundamental tenet of the basics of life insurance.

Here’s a big one– the premium amounts that you pay, for a similar payout amount. As any term life insurance guide will tell you, the difference is huge. Whole life premiums are multiples of what term premiums are for the same coverage amounts. Now, although anyone would be attracted to the idea that his heirs will definitely get a payout upon his death, the high cost of whole life premiums is enough to make a smart a smart buyer think twice, and this leads us to the final, essential point:

Most people don’t buy whole life insurance. They buy term. Good life insurance for them primarily means lower payments and a clearly defined policy.

OK, whole life wouldn’t exist as a product unless it was a good idea for some. But rather than paying the sky-high whole life premiums, most folks opt for a term policy (maybe with an option to renew after the initial term finishes) and try to diligently invest money that they might have paid toward a whole life policy. In this way they will very probably have a larger nest egg when they pass away than the promised whole life payout that their sizable premiums are going toward each month. This is the most critical difference between term life insurance and whole life, and while it’s always best to get a second and third opinion on life insurance basics as you augment your knowledge with a good whole and term life insurance guide, it’s why you’ll most likely end up buying term life.

Life Insurance No Physical-Think Twice

You have probably seen advertisements in newspapers and magazines for life insurance requiring no physical examination, as a condition for getting insured. But what are the downsides of policies of this kind?  These policies are also known as “guaranteed issue” or “simplified issue” policies, with simplified issue insurance requiring that you just answer a few medical questions. On the surface of it, it seems like “no exam” is the type of life insurance that anyone would prefer. Why would I want to go to the trouble of getting a physical examination when so many companies seem very eager to sell me term life insurance no physical? Continue reading “Life Insurance No Physical-Think Twice”

Exclusive Life Insurance Leads

Before the internet, insurance agents were condemned to do real life seminars and other cost-heavy procedures in order to obtain their exclusive life insurance leads. Now, with the emergence of the World Wide Web, a whole new way of doing business has emerged. This has at times been called “attraction marketing” as well as other things and I will outline the basic gist of it in this article. Continue reading “Exclusive Life Insurance Leads”

Mortgage Insurance Quote Tips

A mortgage insurance quote is something you should seriously consider obtaining if you are a homeowner and would like to protect yourself and your family from dire financial straits should you as the primary wage earner become incapacitated or if you pass away. In this article I will attempt to cover a few of the pros and cons of Continue reading “Mortgage Insurance Quote Tips”

What Is Variable Life Insurance

A variable life insurance policy is a type of permanent life insurance that enables you to be more proactive in using the underlying cash value of the policy. With variable life insurance you can invest money in separate accounts holding stocks or bonds whose value would naturally be variable over time, hence ‘variable’ part of the name. So what is a variable life insurance policy? Continue reading “What Is Variable Life Insurance”

Life Insurance Advice

It’s easy to ask around for advice on life insurance, just like it’s easy to find people with opinions on how to successfully make money in the stock market. Asking questions and getting educated on topics like insurance is always a good thing, but the problem is that getting life insurance advice from nonprofessionals may very well result in conflicting advice and confusion on your part. You need to Continue reading “Life Insurance Advice”

Low-Cost Term Life Insurance Tips

Let’s be clear–it is almost redundant to talk about low cost term life insurance, as it is so much cheaper than the alternative, permanent life insurance. Since the latter promises a guaranteed payout, is naturally much more expensive than term life. In fact term insurance isn’t say, half as expensive as permanent life, your term premium payments will actually be Continue reading “Low-Cost Term Life Insurance Tips”