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LIFE INSURANCE

Most people understand they need life insurance to support their family when they die, but deciding what kind of life insurance to purchase, the amount of money you need from a death benefit and how much you are willing to pay for the policy may be a confusing process. Life Insurance doesn't have to be complicated. When you buy a life insurance policy, it pays your beneficiary or beneficiaries (your spouse, children, family members or anyone you list as a beneficiary) when you die. The money will provide for them when you no longer can do so. This is a major decision that requires careful planning and it should not be left as just a form you sign at work. It gives people peace of mind to know that when they die, they do not have to worry about their family being unable to pay for their home, the utility bill or groceries. Ed Cantu's Life Insurance Specialists will explain the different types of life insurance policies, how they help you, and when to choose one policy over another, depending on your particular needs. Call (361) 991-1493 now.

Term Life Policies

Term life policies provide coverage for specific periods of time, sometimes as little as one year. While you usually can renew term life policies for one or more terms even if your health changes, there is potentially a big risk if you get sick during the term.

  • Convertible Term Life: This coverage can be renewed on a yearly basis with the option to convert it into a permanent policy in the future. This is an important feature, especially if your health declines.
  • Renewable Term Life: This coverage is for a longer term of 10, 20 or 30 years. The longer term also means that the costs are spread out to avoid the potential for huge annual premium increases. Renewable term policies can be convertible also, sometimes with limitations or qualifications. Be sure to talk with your local agent for all details.

Permanent or cash-value life policies

Permanent or cash-value life policies have premiums that are higher at the beginning than for the same amount of term insurance. The part of the premium not used to cover the yearly cost for mortality (funeral and burial) and other expenses is invested by the company and builds up a cash value that you may use in a variety of ways. The cash value build up makes this policy less expensive in the long run.

  • Whole (or Ordinary) Life: Like other cash-value policies, this is permanent coverage, where the cost is stretched out over your entire life, or what the Insurance company expects your entire life period to be. Life insurers have tables that tell them how long, on average, someone of your age and physical health will live.
  • Universal Life: This is the most flexible life insurance. You are allowed to change your premium and your death benefit at any time, although an increase in the coverage usually requires you to prove you are still in good health.
  • Variable Life: This is a combination of whole and universal coverage in which the death benefit depends on the investment performance of the company. You get to choose the investment vehicle for your premium from a money market fund, bond fund or stock fund.

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