Life Insurance

Protect your family’s future.

At a recent industry event, behavioral finance expert Meir Statman stated, “The real risks in life are not the stock market,” he said. “If you want real risk, get married. And if you want more risk, have children.”*

This statement makes an important point. Although investors are usually aware of market risk, they may forget about the risk of dying and leaving loved ones without the financial support they might need. Three out of 10 U.S. households have no life insurance, and half say they need more coverage.**

If this describes you, or you would like to make sure your current coverage is sufficient for your needs, contact us, and learn more about the different types of life insurance below.

Term Life

The least expensive way to buy life insurance, Term Life Insurance provides death benefit coverage for a fixed rate of premium for a limited period of time. Time periods are typically 10, 15, 20, 25 and 30 years. Rates are usually guaranteed for the chosen time period. After the period expires, the previous rates are no longer guaranteed and the rates increase substantially.

Universal Life

Universal Life Insurance is a type of permanent life insurance where excess premium payments above the cost of insurance is credited to the cash value of the policy. Each month the cash value is debited the cost of insurance charge and expenses, then credited with interest. The interest rate is determined by the insurer, but has a contractual minimum. Premium payments are flexible and the policy remains in force as long as there is sufficient cash value to pay the cost of insurance and expenses.

Indexed Universal Life

A type of Universal Life Insurance where the earnings credited to cash value are based on a financial index such as the S&P 500 stock market index. This differs from standard Universal Life Insurance where the cash value is credited with interest based on the insurance companies investment portfolio.

Variable Universal Life***

A type of Universal Life Insurance which provides a death benefit and where the earnings credited to cash value are based on policy owner directed investments to separate accounts and can be invested in stock and bond investments with greater risk and potential growth.

Whole Life Insurance

Whole Life Insurance is a type of permanent life insurance that remains in force for the insured’s whole life and generally requires premiums to be paid every year into the policy. Like Universal Life, excess premiums are credited to cash value where insurance costs and expenses are deducted and interest or dividends are credited. If premiums are paid every year the life insurance death benefit is guaranteed for the life of the policy.

*InvestmentNews, April 29, 2013

**LIMRA, 2012

***Variable products are subject to investment risk, including possible loss of principal. Before investing, carefully consider the investment objectives, risks, limitations, charges and expenses of the product and its underlying investment options. This information can be found in the product and investment option prospectuses. Copies are available from my office. Please read carefully before investing.

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