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November 15, 2019

Life Insurance 101


Contact: Amanda Edmunds

I & E Insurance Agency



[email protected]

Life Insurance 101
With Thanksgiving around the corner, it’s time we recognize the importance of family and protecting the safety and wellbeing of your loved ones. I & E Insurance is a family-owned and operated company, so we have a unique perspective on what it means to care for your children and spouse. We also have an in-depth understanding of what things you must do to safeguard their future. Our Life Insurance 101 guide will help you understand how to find the policy that works best for you and your family!

What is Life Insurance?

Life insurance is “insurance that pays out a sum of money either on the death of the insured person or after a set period.” Generally, in exchange for premium payments, your life insurance provider will give a lump-sum payment to your beneficiaries upon your death. There are two different types of life insurance: term and whole life.
Term Life
Term life insurance provides financial protection for a specific amount of time. Traditionally, the premium payment generally remains the same throughout your term. This form of life insurance is less expensive than permanent life insurance. The two basic types of term life insurance include level term, which means “the death benefit stays the same throughout the duration of the policy,” and decreasing term, which means that the death benefit drops in one-year increments as the policy ages.
Whole Life
Whole life insurance is a permanent life insurance policy that provides lifetime coverage. Typically, this includes higher premiums than term life and these payments are fixed with a cash value. Whole life or permanent life insurance has three main types: traditional whole life insurance, universal life insurance, and variable life insurance. In the case of traditional whole life, the death benefit and premium remain the same level. Universal life insurance generally includes a death benefit and cash value component that grows and is tax-deferred. Lastly, variable life insurance allows the policyholder to take part in investment options as equities.

Why You Need Life Insurance

There are a number of reasons why you might need life insurance. Life insurance can help your family pay off debts left long after you’re gone, it can be used to pay off any final expenses that you may have, and serve as an income replacement for your loved ones in the event that you were the primary source of income. Additionally, if you’re looking to leave an inheritance for your children, life insurance can be part of that expense. If you’re looking to leave behind a legacy for your family, it’s important to consider finding a plan that fits best for you.

How Much Does it Cost?

How much your life insurance policy costs is entirely based on some key factors: your age, gender, health, lifestyle, and occupation. Still, a knowledgable financial professional can give you plenty of options that suit your needs and budget.
How Much Life Insurance Should I Buy?
This is entirely up to you and is based on your family dynamic and age. Generally, young families need more death benefits from a life insurance policy due to the increased need for income replacement that comes with growing children. Often, those with empty-nests and senior citizens may need far less, but that doesn’t mean they don’t need life insurance at all.
Having a 101 guide to life insurance helps, but the process can still be daunting! Give us a call at I & E Insurance, and our experts will give you the information you need to make an informed decision when choosing your life insurance policy.

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