Term Life Insurance Blog

Why Term Life Insurance from Employer May Not Be The Cheapest

Sun, 22 Apr 2007 20:55:32 -0800

WSJ's columnist Diana Ransom discussed the same thing I recognized a few years ago: for employees young and healthy, buying term life insurance from employee-sponsored plans may not be the most economical way to get coverage.

Review: TermLifeOptions.com

Wed, 04 Apr 2007 20:24:38 -0800

TermLifeOptions.com is one of such sites what specialize in providing free quotes on term life insurance. The site design is pretty neat, and properly balances the online quote tool with good readings on general insurance concepts (such as why one needs life insurance, how much insurance is appropriate, and description of different types of life insurance products). One drawback of the quote tool at TermLifeOptions though, is its lack of instant quote. Instead, the website chooses to get your demographic background and contact information and promises to contact you offline. Of course, the site has a commercial intention, and it is probably backed by insurance agents who will appreciate referrals with full contact information. With that said, I have to credit the web site with the quality of content on insurance topics. If you don't have a clue about life insurance, the several articles on the web site should serve as a good starting point for you to reconsider your insurance plan. (Although, I have to say, the inclusion of universal life and whole life insurance introduction without appropriately promoting the benefits of term life insurance might not necessarily serve the commercial purpose of this term-life-insurance-quote-only site.) (While the above is a sponsored post, PFBlog is not required to provide a favorable review. Quality time was spent to study the subject website in completing this post to provide an independent opinion.)]]>

Term Life Insurance: It's Getting Cheaper and Cheaper

Wed, 21 Feb 2007 17:48:34 -0800

It shouldn't be a surprise that term life insurance is getting cheaper because people are generally living longer. Also, the popularity of getting insurance coverage from online outlets reduced the cost of insurers, which also drives the cost down. Is it time for me to double-size my million-dollar policy?

What Are The Diffeent Kinds Of Term Insurance?

Wed, 01 Nov 2006 22:28:39 -0800

If you’re considering term life insurance, keep in mind that there are many different kinds of term life insurance. This includes decreasing term insurance, increasing term insurance, increasable term insurance, decreasing term insurance and renewable term insurance among many. It’s important to find the type of term life insurance that fits your needs best. Decreasing term life insurance reduces the coverage of the policy year on year. The policy holder usually requires the cover for a loan repayment such as a mortgage or to cover a potential inheritance tax bill. Increasing term life insurance is just like basic term life insurance, except that, as the name suggests, the level of coverage increases. Premiums increase along with the level of coverage as well. Increasing term insurance is suitable for long term insurance because increasing prices reduce the value of a fixed level of coverage over the period of the policy. Increasable term life insurance provides the option of increasing the level of coverage either at specific intervals (such as every year on the start date of the policy) or specific events (such as marriage or the birth of a child). Premiums increase for additional cover, but they are based on your health at the start of the policy, even if it has deteriorated since. Renewable term life insurance gives the policy holder the option to extend the insurance term when it comes to an end. The premium paid is the same at the start of the term, despite any deterioration in the policy holder’s health. Always do your research when looking into purchasing term life insurance. Spending some extra time now deciding what is best for you will most likely save you a lot of money in the future.

Does Permanent Life Insurance Make Sense?

Sun, 29 Oct 2006 22:28:39 -0800

Most Life Insurance Buyers Still Don't Get It. Permanent life insurance can be so valuable to most insurance buyers. About 20 or 25 years ago most people started thinking about buying term insurance rather than permanent life insurance. The common beliefs were that you could get so much more insurance for your dollar so that was the way to go. Was it? I sincerely believe that term insurance is the best type of policy for many people but serious consideration should be given to permanent plans like universal life, variable universal life, variable life and whole life insurance. There also is nothing wrong with starting out with term insurance and at a later date converting to a permanent insurance plan... The arguments of buying term have a lot of validity. You can get much more for you dollar. You can use the difference and invest it in stocks, bonds, money market funds, mutual funds or real estate. There is a lot of truth to these ideas. But ask yourself how viable is that suggestion? Will the money be invested? For those who put forth this argument was the extra money really invested over the last 20 or 25 years? The fact is the extra money, more often than not was not invested. In many a case these funds were wasted on trivialities that were considered important at that time but looking back the errors made became quite evident. If you are a very disciplined person buying term and investing the difference can be a good idea for a while but as you get older you become more aware that you will always need some type of life insurance. Permanent life insurance becomes a necessity. In your later years you may not be able to qualify for it so it should be purchased as soon as possible...whether you are converting a term policy or you are buying it from the outset... Bear in mind as you go forward with your life that your family has to be protected in the event of your premature death. Even though the estate tax law has been repealed the amount you pay decreases over the years until the year 2010. So if you died with a sizable estate you will likely have to pay some estate taxes. The least expensive way to fund the payment of these taxes is through a tax free, upon death, term or permanent life insurance policy. If you are a business whether a sole proprietorship, a partnership or a corporation you will always have a need for life insurance. In the embryonic years of your business you may use a term policy but you should always plan to convert as you progress. Each individual buyer of life insurance should, therefore, take the time to look at term life insurance as well as permanent insurance. If you can only handle term premiums at this time, great. You can start with that but plan to convert some time in the future.

How Much Life Insurance Do You Need?

Wed, 25 Oct 2006 22:28:03 -0800

Insurance is the means that an individual or a family can use in order to help them prepare against the emergencies of life. Life insurance is the form of this preparation that helps in the worst emergency – the death of a loved one. This could be for anyone in the family, or for the main breadwinner. Because so many things can happen to people, mostly unexpected, we want to be ready in the event that it does happen - but hope, too, that it never does. This article will show you how to determine just how much life insurance you should have in order to be prepared in the best way possible. When determining just how much coverage you should have, here are some things that you definitely want to take into consideration. Your Yearly Expenses In the event that the main earnings winner should pass away, the goal of a life insurance policy is to sustain the family at its present level of living for a while. This means you need to calculate exactly what it costs for the family to live at the present level for one year. In order to help you calculate according to the rising cost of inflation, you should add a percentage increase for each year - possibly as much as 8%. Educating The Children To this figure, you need to add just how much it will cost to put each child all the way through college. Of course, this may be a little hard to do, since college costs are rapidly raising. You should add, however, a percentage increase for each year until they graduate. A suggested amount would be 1 or 2% increase of the current tuition per year before college and during. Current Debts All of your current debts should also be added to the total amount of life insurance coverage. By adding this amount, it would enable the family to continue its current level of life - debt free. If there is any mortgage balance still owed, credit card debt, your own education bills, and any other bills should all be added into the calculation. Funeral Costs The costs of funerals these days have become a lot more expensive than they used to be, along with everything else. Funerals are now an average of about $6,500. Just to be safe, though, you need to add another $4-$5,000 so no debts are left after the funeral. Inheritance In your absence, it would be a good idea to leave your children a little extra to get them started and secure in life, if you are able. Calculate how much you want each of them to have, and then add that amount to the total. Finally, in your calculations, you may want to add a couple of other things - depending on your situation. If you have parents that may need nursing home care before long, or a divorce situation that you have to include, or you may even want to add a donation to either a religious organization or to a charity. It all depends largely on what you can afford. You will not want to buy hastily, without having a rather good understanding of life insurance, and make sure that you do a cost comparison, too.

Buy Term Life Insurance And Invest The Difference?

Fri, 06 Oct 2006 17:24:26 -0800

To me, insurance is insurance and investment is investment, so to by term life insurance and investment and invest the different is always the right choice.

What Is Level Term Life Insurance?

Thu, 05 Oct 2006 06:55:14 -0800

Level Term Life Insurance is a cost effective way of arranging life assurance. Level Term Life Insurance is often used for family protection purposes by providing life insurance cover in the event of the death of the life or lives assured for the benefit of the surviving spouse and, if there are any, the dependant children. The amount of life cover provided is often agreed upon after receiving advice from a financial adviser who will assess a family's requirements taking into account a number of factors. The amount of Level Term Life Insurance remains level for a specific term i.e 25 years and is arranged normally on a sole life or joint life first death basis with the premium often remaining constant throughout the term. If the life assured outlives the term then the Level Term Life Insurance policy normally finishes and the life policy pays out nothing. This is one of the reasons why Level Term Life Insurance is normally cheaper than say a Whole of Life policy. Level Term Life Insurance is also used to cover personal and business liabilities such as overdrafts.

How To Choose A Good Term Life Insurance Company?

Thu, 05 Oct 2006 06:55:14 -0800

Any kind of life insurance can be a scary thing to think about. Let’s face it – aside from withdrawing from or cashing in your life insurance policy in the event of an emergency or in times of financial strain, the only other time the money of a life insurance policy will be used is when you die. Because of this scariness, many people put off choosing a term life insurance company. Add to this the fact that many people simply do not know what to look for in a term life insurance company, and the result is that a lot of people just don’t purchase needed term life insurance policies for themselves. However, we can help you painlessly choose a term life insurance policy. There are just a few things you need to know. Stop procrastinating. And get over your fear. Making the choice to purchase a term life insurance policy is responsible. Research yourself. Before you start shopping for a term life insurance company from which to purchase your term life insurance policy, you must know what you’re looking for. After all, you don’t head to the grocery store without at least some idea of what your pantry is lacking, do you? Sit down and think about your needs. How long do you need coverage? How much coverage do you and your family members need? Consider these factors both in the event of emergencies and in the event of your death. Research companies. Better put, thoroughly research companies. As you’re shopping around, narrow your search to companies with high financial ratings. Also be sure to keep your budget in mind. Remember, each term life insurance company is in competition with the next, so as long as figure out the exact coverage you need and for how long you’ll need the coverage, as well as the budget you’re working with, you’ll find the right term life insurance company for you.

Different Types Of Life Insurance Plans

Thu, 05 Oct 2006 06:55:14 -0800

Basics: There are 4 parties in any life insurance policy. The policyholder is the one who is buying the policy, the insured is the one against whose death the policy is made, the insurer that is the insurance company and finally the beneficiary is the person who will get the proceedings of the life insurance policy. It is mandatory that the policyholder should have a legitimate reason for insuring a person’s life. Types of Life Insurances: 1. Temporary Life insurance. This policy is also called term life insurance that has coverage for a fixed period of time. The policyholder needs to pay a premium for a fixed period of time for which the insurance company provides insurance coverage. This type of policy does not accumulate cash value. 2. Permanent Life Insurance. This type of policy provides coverage till the policy matures. A policy is said to mature when the person reaches a fixed age or dies. The policyholder needs to pay premium for the entire period. This type of policy accumulates a cash value. The policyholder can withdraw or borrow the money or surrender the policy to receive surrender value. There are 3 types of permanent life insurances. 2.1 Whole life insurance. This has a level premium and corresponding cash value. Upon death of the insured, the beneficiary receives the death benefit only and not the cash value. The policy owner can borrow loans on the cash value. 2.2 Universal life insurance. This has a flexible premium and gives higher internal rate of return. The policy has a cash account depending upon the premium. The surrender value equals the cash account balance. 2.3 Variable Universal life insurance. This is similar to universal life insurance with cash account. However the money is invested by the insurance company in mutual funds for a greater return. Hence there is higher probability of increase of cash account but the risk of reduction in cash account is also present.

How Your Life Insurance Rate Is Determined

Thu, 05 Oct 2006 06:52:39 -0800

In order to get a life insurance rate quote, you must first determine what kind of life insurance policy you want to purchase. There are two basic kinds of life insurance policies – term life insurance policies, and whole life insurance policies. Term life insurance policies offer life insurance coverage for a “term.” This means, your life insurance coverage will last for a certain period of time. Most term life insurance policies offer coverage anywhere from five to thirty years. How long your term life insurance policy lasts is up to you. Term life insurance policies appeal to people because of the lower life insurance rate quote. Term life insurance policies are usually less expensive than whole life insurance policies, because term life insurance policies don’t offer, or require, the components that whole life insurance policies do. When you purchase a term life insurance policy, you’re purchasing pure life insurance. In contrast to term life insurance policies, whole life insurance policies offer life insurance coverage for the rest of your life. They also provide a required savings component along with the whole life insurance policy. Some people are attracted to this savings component because it allows the whole life insurance policy to accumulate a cash value. The policyholders can use that cash value in certain times, such as times of financial stress, or times when they want to put the accumulated cash toward their policy premiums. When you begin your search for a life insurance rate quote, take note that your life insurance rate quote will most likely reflect the type of life insurance policy you decide to purchase. You’ll usually pay less for a term life insurance policy, and get simply the life insurance coverage you want. You’ll usually pay more for a whole life insurance policy, but get extras you might need. Consider the life insurance rate quote based on the coverage, and extras, you want with your policy.

25-Year Term Life Insurance May Be A Good Choice

Thu, 05 Oct 2006 06:51:44 -0800

Yes, 20 to 25 years of term life insurance coverage is enough protection for a 30-year old in his highest earning years.

Quick Facts About Viatical Settlement?

Thu, 05 Oct 2006 06:51:42 -0800

A viatical settlement is the sale of a life insurance policy by the policy owner, before the policy matures. Such a sale provides the policy owner an immediate cash settlement. Generally, viatical settlements involve insured individuals with a life expectancy of less than 5 years. Life settlements, also called senior settlements, are similar to viatical settlements, but involve the sale of as life insurance policy when the owner has a shortened life expectancy, but the life expectancy is over 5 years. In countries without state-subsidized healthcare and high healthcare costs such as the United States, this is a practical way to pay extremely high health care costs that severely ill people face. Often this is the only means of obtaining the funds necessary to pay for health care when afflicted with a fatal illness. The Life Insurance Settlement Industry exists because it provides a unique financial service to policyholders in need. Simply put, viatical settlements allow policyholders to use their life insurance policy as a liquid financial asset. It is an invaluable service for those in need of financial assistance. The amount of funds provided in a viatical settlement reflects the discounted future value of your life insurance proceeds. There are four important factors in the computation of a present value amount. These factors include the stated amount of the life insurance policy, the expected amount of time until collecting the life insurance proceeds as reflected in the insured's life expectancy estimate, the annual cost of maintaining premium payments, and a yearly rate of return (discount rate). To further explain these four factors, let's assume you currently have a life insurance policy of $500,000, and that you have a type of inoperable cancer. Your life expectancy with this type of cancer is 3 years. A firm or investor will purchase your life insurance policy from you. The actual sale of your life insurance policy is a viatical settlement. However, you will not be able to sell your policy for the entire $500,000, as there are costs associated with the purchase that the investor will factor in. The first factor is the policy amount. In our example, it is $500,000. That is the starting point for computation. The second factor is life expectancy. In this example, it is 3 years. The investor who purchases your life insurance policy will have to wait 3 years for the return of his money. Now, this 3 year period is simply a medical estimate. It may be less, it may be more. This is a risk that the investor assumes. The third factor is the cost of the monthly or annual premium payments to keep the policy in force. The $500,000 policy is instantly worthless if allowed to expire. Whatever the monthly premium payment is will be factored into the present value. Lastly is a rate of return for the investor. Obviously, the investor could earn interest on his money by simply putting his money in a savings account or certificate of deposit. To assume the risk, the investor will want a rate of return higher than other alternatives that carry less risk. Once all of these factors are computed, the investor will determine a present value of the future payment of your life insurance policy, and offer to purchase it from you for this value. The present value will be different from one investor to another. Some may factor a higher margin of life expectancy, while others may want a higher rate of return. The best way to find the highest offer is the same way that you purchase a new car: shop around. In the early days of viatical settlements, the industry was largely unregulated. There were some problems and abuses, but those have since vanished once government regulators became involved. Despite the previous bad experience of some investors, viatical settlements remain a valuable tool for the personal financial management of many ill people. A 2002 study showed that among hospice financial counselors who have had experience with viatical settlements, most report positive experiences.

Decreasing Term Life Insurance: Quick Facts

Thu, 05 Oct 2006 06:51:35 -0800

Decreasing Term Life Insurance is a cost effective way of arranging life assurance. Decreasing Term Life Insurance is usually taken out to repay such things as loans and mortgages in the event of the death of one of the lives assured but can occasionally also be used to provide family protection cover. It should be noted that the amount of Decreasing Term Life Insurance decreases during the term of the life insurance policy normally approximateley in line with the amount the loan or mortgage decreases so there should normally be sufficient life insurance cover in place to clear the liability in the event of the death of the life/lives assured during the policy term. The premium normally remains constant but the amount of the premium reflects the fact that the life insurance cover is decreasing. Decreasing Term Life Insurance is normally arranged either payable on a sole life or joint life first death basis. In the event of the lives assured being alive at the end of the policy term the Decreasing Term Life Insurance policy normally finishes and nothing is payable.

What Is Adjustable Life Insurance?

Wed, 20 Sep 2006 02:27:40 -0800

Adjustable life is a type of permanent protection that lets you change the amount of your premiums. You can also raise or lower the face amount of the policy, or shorten the protection period. If you increase the death benefit, you must prove that you are still insurable.

How To Save On Life Insurance

Wed, 13 Sep 2006 14:42:42 -0800

SmartMoney offers 10 time-tested tips on how to save on life insurance.

Term, Whole, Or Return Of Premium. Which Life Insurance Is Best?

Wed, 13 Sep 2006 14:00:43 -0800

SmartMoney's recommendation is term life insurance, and I cannot agree with it more. Don't confuse insurance with investment. Let term insurance take care of your insurance needs, and get your investment portfolio in order to get the return you want.

What Is "Return of Premium" Term Life Insurance?

Sat, 26 Aug 2006 11:05:33 -0800

Have you heard about "Return of Premium?" Here is what it is when it comes to term life insurance:

Term Life Insurance: Level Term vs Decreasing Term

Fri, 25 Aug 2006 11:03:17 -0800

Do you know the difference between level term life insurance and decreasing term life insurance?

Why Should You Buy Life Insurance?

Thu, 24 Aug 2006 10:55:06 -0800

Insurance Information Institute explains why you need life insurance.

Yes, Smokers Can Still Get Term Life Insurance

Wed, 23 Aug 2006 14:34:22 -0800

If you’re a smoker, you may think that you can’t get quality term life insurance coverage. In the highly competitive insurance marketplace, companies are beginning to realize that smokers are a large market segment who are willing to pay elevated (but not excessively so) premiums for term life insurance coverage. The fact that you smoke can be determined by a urine test that measures nicotine levels. Depending on the level, you might be classified as a light, moderate or heavy smoker and be charged accordingly. Some companies, however, do not make this distinction, and smokers are counseled to seek out companies that do.

Life Expectancy Table

Tue, 22 Aug 2006 12:28:40 -0800

Take a look at the life expectancy table used by major insurers. If you want to use it to plan for your retirement, it might be wise to add ten more years as a safeguard. According to the table, I can live for another 45 years, and my wife will likely outlive me by almost three years.

Life Insurance Buying Tips

Mon, 21 Aug 2006 02:24:43 -0800

Some time-tested tips for life insurance buyers from the Office of the Insurance Commissioner of Washington State. If short, all life insurance buying tips can be reduced to two: sticking to term life insurance and comparison shopping.

Term Life Insurance Comparison Shopping on the Web

Sun, 20 Aug 2006 22:11:45 -0800

Wholesale Insurance. I used it to acquire term insurance for both my wife and myself last year, and its service is top-notch.]]>

The Benefits Of Term Life Insurance

Tue, 15 Aug 2006 05:02:59 -0800

I am a huge fan of term life insurance. When it comes to insurance, it is necessary to draw a line between protection and investment. Oftentimes, individual's investment interests can be best served by specialized investment vehicles instead of these fancy whole life insurance products.