Life Insurance can be a good idea for both individuals and business owners. A number of businesses offer life insurance as a benefit to their employees, but you should still have an independent policy of your own in addition to your work plan. Let’s face it, most of us will change jobs numerous times throughout a lifetime and typically your benefit plan will also change. Obtaining a life insurance plan on your own ensures that your loved ones will be taken care of despite potential job change or job loss. J.P. Kush & Associates can also help self-employed, business owners find the right plan for their budget and needs, whether it’s a buy-sell arrangement, key-man insurance, term life insurance, universal life insurance or whole life insurance.
Term Life Insurance: provides life insurance coverage for a specified term. The policy does not accumulate cash value. Term is generally considered “pure” insurance, where the premium buys protection in the event of death and nothing else. An example might be a 20 year term insurance policy with a $500,000 death benefit to ensure that your young children would be provided for in the case of an untimely death.
Permanent Insurance, on the other hand, usually combines both a death benefit along with some cash accumlation, depending on the plan. These types of life insurance policies are usually intended to run for the length of one’s entire lifetime, not a specific number of years. As a result, this form of coverage is more costly than term insurance, at least in the short run.
Universal Life Insurance: is a relatively new insurance product, intended to combine permanent insurance coverage with greater flexibility in premium payment, along with the potential for greater growth of cash values. It addresses the perceived disadvantages of whole life – namely that premiums and death benefit are fixed. With universal life, both the premiums and death benefit are flexible. Except with regards to guaranteed death benefit universal life, this flexibility comes with the disadvantage of reduced guarantees. There are several types of universal life insurance policies that include interest sensitive life insurance, variable universal life (VUL) insurance, flexible death benefit insurance,
guaranteed death benefit life insurance, and equity indexed universal life insurance.
Whole Life Insurance: provides lifetime death benefit coverage for a level premium in most cases. Premiums are much higher than term insurance at younger ages, but as term insurance premiums rise with age of the applicant, the cumulative value of all premiums paid across a life time are roughly equal if policies are maintained until average life expectancy. Part of the insurance contract stipulates that the policyholder is entitled to a cash value reserve, which is part of the policy and guaranteed by the company. This cash value can be accessed at any time through policy loans and are received income tax free. Policy loans are available until the insured’s death. If there are any unpaid loans upon death, the insurer subtracts the loan amount from the death benefit and pays the remainder to the beneficiary named in the policy.
J.P. Kush & Associates works with a number of carriers in order to find a plan that fits your needs and budget.