Best Valentine’s Day Gift: Life Insurance

You’ve bought chocolates and roses, made reservations at the best restaurant in town but did you remember the life insurance? While not the most romantic gesture, life insurance may be the best gift you can give your loved ones.

Your loved ones mean everything to you and you are committed to providing and caring for them – now and in the future. Life insurance is one of many ways you can do that by providing a means for you to continue to provide for your loved ones in the event something happens to you.

When you purchase a life insurance policy, you contract with an insurance company to make payments and, in exchange for those payments, the insurance company promises to pay a lump-sum to a person you choose (your beneficiary) upon your death.

Payments may be used for:

  • Funeral costs
  • Bills or future living expenses
  • Outstanding debt, such as medical bills or a home mortgage
  • Your child’s education or college expenses
  • Your spouse’s retirement plans

Since looking out for the best interest of those we love is the ultimate love gesture, we thought we would take this Valentine’s Day to answer a few of your questions about life insurance.

  1. What are the different types of life insurance policies?
    There are basically two types of life insurance policies: term life and permanent. Term life insurance provides coverage for a specific “term”, or time period. If you die during the coverage period, then your beneficiary will receive payment from the insurance company. At the end of the term, the policy expires, or you have the option of renewing for another term. Terms range from 1 to 30 years. Term life insurance is an affordable option and can be ideal for young families.

Permanent life insurance options include whole and universal life insurance policies. Whole life policies will protect you and your loved ones throughout your lifetime. Every payment you make helps to grow a cash reserve that can be used for emergencies and other major expenses when you need it. With whole life insurance, your payout is guaranteed as long as your premiums are paid. Similar to whole life insurance, universal life policies guarantee your payout as long as the premiums are paid. However, with universal life insurance you can adjust your premium payments throughout the life of the policy. In addition to these types, there are also final expense and children’s policies as well as annuities.

  1. Is life insurance expensive?
    One of the common misconceptions is that life insurance is expensive. While the cost varies dramatically, there are very affordable options for as little as $12/month. The best approach is to work with a qualified insurance agent who can assess your unique situation and determine the best policy for you.
  2. How much life insurance do I need?
    A general rule of thumb is 8-10 times your salary; however, the amount is very dependent on your unique circumstance. Are you married? How large is your family? What are your financial obligations? What are your retirement plans? While there are many tools available to help you determine how much coverage you need, the best tool is a life insurance professional, well-versed in the policies and options available. At Penny Insurance Agency, we not only have a team of experts to help address your questions but, as an independent agency, we also have the freedom to shop around on your behalf to find the very best policy and coverage for you.

Making sure you buy life insurance that is right for you is important. At Penny Insurance, we have experts available to help talk you through the different policy options available and choose the one that is best for you and your loved ones.

Plus, we recognize that life does not stand still. Your and your family’s needs are constantly changing. You want to insure your life insurance keeps pace with your changing lifestyle. When you purchase a policy through Penny Insurance, we conduct regular assessments of your current policies to make sure they continue to meet your needs.

Important decisions require thoughtful consideration. Our job is to make sure that you have the information you need to make the best decision.