Life Insurance

Life Insurance We all dream of a tomorrow that is secure, stable and full of financial freedom. One of the easiest ways to make it happen is through life insurance. We has a range of life insurance plans that help you fulfill your various needs – be it financial protection of your family, planning for your child’s education, saving for retirement or just growing your wealth.

What is life insurance?
New to buying life insurance?
Learn how it works and what you need to understand to choose your coverage
. A life insurance policy is a contract with an insurance company. In exchange for premiums (payments), the insurance company provides a lump-sum payment, known as death benefit, to beneficiaries in the event of the insured’s death.

Typically, life insurance is chosen based on the needs and goals of the owner. Term life insurance generally provides protection for a set period of time, while permanent insurance, such as whole and universal life, provides lifetime coverage. It’s important to note that death benefits from all types of life insurance are generally income tax free.

There are many varieties of life insurance. Some of the more common types are discussed below.

Term life insurance
Term life insurance is designed to provide financial protection for a specific period of time, such as 10 or 20 years. Typically, premiums are level and guaranteed for that time. After that period, policies may offer continued coverage, usually at a substantially higher premium date. Term life insurance is generally a less costly option than permanent life insurance.

It’s important to note that, although term life can be used to replace lost potential income, life insurance benefits are paid at one time in a lump sum, not in regular payments like paychecks.

Universal Life Insurance
Universal life insurance is another type of permanent life insurance designed to provide lifetime coverage. Unlike whole life insurance, universal life insurance policies are flexible and may allow you to raise or lower your premium or coverage amounts throughout your lifetime. Like whole life insurance, universal life also has a tax-deferred savings component, which may build wealth over time. Additionally, due to its lifetime coverage, universal life typically has higher premiums than term.

Whole Life Insurance
Whole life insurance is a type of permanent life insurance designed to provide lifetime coverage. Because of the lifetime coverage period, whole life usually has higher premiums than term life. Policy premiums are typically fixed, and unlike term, whole life has a cash value, which functions as a savings component and may accumulate tax-deferred over time.

Determining your coverage need
Once you understand the types of life insurance available, learn how to choose a suitable amount of coverage for your insurance needs.

Choosing between term and permanent coverage
Identifying the appropriate type of insurance – term or permanent – is the first consideration in choosing coverage. If your insurance need is for your lifetime, then whole or universal life insurance may be an appropriate solution. If your insurance need is primarily for a specific period of time, such as your working years, then term life insurance needs to ensure that the people important to you are protected

Choosing coverage amount
In addition to your coverage period, the coverage amount is another important consideration. The coverage amount is how much will be paid to your beneficiaries if you (the insured) pass away. Your coverage amount will depend on the need you are trying to meet, but these are some general factors to consider

• Your potential income
• Your assets
• Your liabilities (such as debts)
• Any existing insurance (individually owned or through work)
• Other costs your family is expected to face

Major events in your life can be good opportunities to make your initial life insurance purchase or review your current coverage.