12 Life Insurance Tips

Tips & Benefits of Life Insurance

1. Buy enough life insurance to meet your needs; life insurance is not the place to skimp.  Especially due to term life insurance being so affordable.  A good rule is 6-10x your income!
2. Match the duration of your term policy to your needs. Make sure your dependents are covered until they can provide for themselves, or that your spouse is covered until retirement income becomes available.
3. Buy when you are healthy!  When you get into your 50s and 60s, it may be harder to find affordable life insurance.
4. To avoid any chance of the insurance company contesting your life insurance, you must disclose all of your information truthfully.  If the pertinent details are not represented or are withheld on your application, upon your death, the insurance company can deny your claim.  This would be a shame and defeat the intention of the coverage.
5. The convertibility feature allows the insured to convert their policy to a permanent one before the term expires without going through underwriting.
6. Accelerated Death Benefit is a new feature for the insured if they become terminally ill.  The benefit allows the policy owner to receive, in advance of the insured person’s death, a significant portion of the death benefit that otherwise would be paid after death to the beneficiaries. Often as much as 80%, and sometimes more, is available at any time within the last year or two of the person’s projected life.  The funds received from accelerated benefits can be used by the policy owner for any purpose he or she chooses, whether to pay for extra or experimental medical care, to take a trip, to improve a home, hire nursing staff, or anything else.
7. Contrary to belief, Group Life insurance may not be cheaper than individual policies.  Rates will be subject to the characteristics of the group as a whole, which take in to consideration:  average age, health and other risk factors.
8. Proceeds paid by the insurance company upon death of the insured are not includible in taxable income for federal and state income tax purposes for the beneficiary.
9. Life insurance can be used to ensure that your mortgage is covered in the event of your death.  Term life insurance is typically the vehicle for this specific short term need.
10. Key Man life insurance is a policy written to help a company when its survival rests on key employees. Typically, the company pays the premiums and is the beneficiary if the person dies.  The money is generally either used to keep the company afloat while finding a replacement, or to make it easier to liquidate the company, pay off debts, and split the proceeds between shareholders (often the owner's family). 
11. Life insurance polices are one way to cover the future expenses; so that your child has the financial ability to pay for education if something happened to you.
12. Let J.Freeman & Associates, Inc. prepare an analysis for you by comparing rates from hundreds of carriers in the market place.  Our goal is to ensure that your future is secured!