Institute for Wealth & Safety

5 Minute Lesson on Life Insurance

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You probably own some type of life insurance - and you most likely have an opinion that the policy you own is the right one. When you request the  Free Video the information provided can help you gain a level of understanding about this product few insurance companies nor their agents are willing to tell you.

You will learn the rules the government has placed on these contracts and how understanding these rules can benefit you.

You will also learn which type of insurance contracts offer the greatest benefits and be able to determine if you are being offered a Maximum Efficiency Contract.

No longer will you have to wonder if you bought the right product.

What you don't know may be more important than what you do know!

What are the benefits of life insurance?
In the most general terms, owning life insurance guarantees that, in the event of the insured's death, a death benefit will be paid to the insured’s beneficiaries. In addition, permanent insurance provides a savings component from which cash can be accessed for various financial needs such as college tuition, a down payment on a home, business opportunities and more.

Types of life insurance

Who needs life insurance?
Everyone needs life insurance, if only to pay final expenses. People with children, or other family members that are financially dependent on them, may need more life insurance than those with other needs or goals. Perhaps the best way to determine if you need life insurance is to ask yourself: "Financially, would my family be able to live tomorrow as they do today, if I were no longer around?" If your answer is no, then you probably need life insurance.

Replace income for dependents If people depend on your income, life insurance can replace that income for them if you die. The most commonly recognized case of this is parents with young children. However, it can also apply to couples in which the survivor would be financially stricken by the income lost through the death of a partner, and to dependent adults, such as parents, siblings or adult children who continue to rely on you financially. Insurance to replace your income can be especially useful if the government- or employer-sponsored benefits of your surviving spouse or domestic partner will be reduced after your death. Pay final expenses Life insurance can pay your funeral and burial costs, probate and other estate administration costs, debts and medical expenses not covered by health insurance. Create an inheritance for your heirs Even if you have no other assets to pass to your heirs, you can create an inheritance by buying a life insurance policy and naming them as beneficiaries. Pay federal “death” taxes and state “death” taxes Life insurance benefits can pay estate taxes so that your heirs will not have to liquidate other assets or take a smaller inheritance. Changes in the federal “death” tax rules between now and January 1, 2011 will likely lessen the impact of this tax on some people, but some states are offsetting those federal decreases with increases in their state-level “death” taxes. Make significant charitable contributions By making a charity the beneficiary of your life insurance, you can make a much larger contribution than if you donated the cash equivalent of the policy’s premiums. Create a source of savings Some types of life insurance create a cash value that, if not paid out as a death benefit, can be borrowed or withdrawn on the owner’s request. Since most people make paying their life insurance policy premiums a high priority, buying a cash-value type policy can create a kind of “forced” savings plan. Furthermore, the interest credited is tax deferred (and tax exempt if the money is paid as a death claim).