Life Insurance

What is Life Insurance?

Life insurance is a contract between an individual and an insurance company, where an individual pays into a policy in return for a lump sum payment upon death. Most individuals purchase life insurance to leave money behind to loved ones after death, often to cover any outstanding debt or expected income loss.

 

Do I need Life insurance?

Life insurance is necessary for individuals that have large outstanding debts like mortgages or student loans, those that have children that would not be able to support themselves in the event of an unexpected death, and those have not paid for their burial costs. There are many types of life insurance, contingent on each individual situation. If you have large debts that you would not want to leave to your loved ones, children who may not be able to support themselves in an unexpected death of a parent, or unpaid burial expenses, please contact us for more information about the different types of life insurance.

 

What is Final Expense life insurance?

Final Expense life insurance is a permanent but small whole life insurance policy used to meet any funeral expenses or outstanding debts at the time of burial. Usually, Final Expense policies offer benefit amounts between $5,000 - $50,000, in $1,000 increments. Final Expense is the most affordable life insurance for those that are 65 and older.

Why Do I need Final Expense life insurance?

Whether you realize it or not, most people do not have the extra money set aside at their time of burial to pay for funeral costs - and do not want to leave these and other outstanding debts with their loved ones. For a much lower premium than traditional whole life insurance, Final Expense can help individuals have the money set aside for their burial, ceremony, cremation, and other end of the road necessities.

 

I have health issues; can I still get Final Expense life insurance?

Short answer - Yes! There are many types of final expense policies, some even guaranteed issue; but all carriers will offer the policy at different rates based on your health. In most cases, clients who are not in the best health will qualify for what is called a “graded” policy. Graded policies will remit the premiums paid into the policy if the beneficiary passes away within the first two years, but will pay out the full benefit after the first two years.

What is Term Life insurance?

Term life insurance is a temporary insurance policy that lasts for 10, 15, 20 or 30 years. Term life insurance policies are used most often as an income replacement tool in the event of an unexpected death of an income generating family member. Unlike whole life policies, Term life insurance policies do not hold any cash value, and only pay out if the beneficiary passes away during the specified time frame (10, 15, 20, or 30 years). If the beneficiary does not pass away in this time frame, the policy is null and void if is not converted or paid for at a higher premium. Before this happens, you may want to contact an agent for advice.

 

Who needs Term Life insurance?

The most common candidates for term life insurance are individuals between 19-65 years old who have large outstanding debts like mortgages and car payments, and who have a spouse or children who could not support themselves financially if the beneficiary were to pass away suddenly. The term length chosen should be based on the period that the family would not be able to pay the debts or support themselves financially after the beneficiary were to pass away. In general, most people who have children under 18 and any outstanding debts should have some form of life insurance.

 

 

What happens if my Term Life insurance is expiring?

When a term life insurance policy approaches expiration, the beneficiary is usually offered an extension or conversion on the policy. To extend the policy after the term ends will result in a substantially higher premium in comparison to the original rate. To convert the policy to a small whole life is a more cost-effective option, if the current policy will allow it. Once the term has completely expired and is not renewed or converted, the money is lost. When faced with an expiring term, most individuals begin to look converting to smaller whole life insurance policies, like final expense. Please contact us at 848-226-6897 if you need assistance.

 

What is Whole Life insurance? 

Whole life insurance policies are built to last the entire life of the beneficiary; from the age purchased until death. Whole life insurance policies can be more expensive than term, but they build cash value within the policy that can be drawn upon, and they do not expire! At a younger age it is more affordable and advised to purchase larger whole life policies. At an older age, it is usually more cost beneficial to focus on small whole life policies like final expense.

 

How do I know what life insurance policy is right for me?

Life insurance can be a complicated topic. Sorting through the companies, types of policies, and making the right choice so that you get what you paid for years down the road can seem impossible. Here at NJ Life and Health Insurance Group, we make it possible! Years of experience and thousands of clients allow us to guide you using not only knowledge, but client satisfaction!

NJ Life and Health Insurance Group, LLC is not affiliated with or endorsed by the Social Security Administration or the Federal Medicare Program

© 2018 NJ Life and Health Insurance Group

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