With over 20 years’ experience providing Life Insurance solutions for our clients, Hershenberg Stone-Walsh Insurance Services understands the complexities of life insurance and represents many of the nation’s top life insurance companies. Our process is simple, we start by listening and understanding our client’s needs. Through this process, we can help our clients find the right life insurance company, the right type of policy and the amount of coverage needed. We also know that applying and getting approved for coverage can be time-consuming and frustrating, so we have built an easy, no hassle process for our clients. In certain situations, many of the life insurance companies we represent do not even require a medical exam.
Types of Life Insurance
The two basic types of life insurance are term life and permanent (cash value) life.
Term Life insurance policies provide life insurance protection for a specific period of time (subject to the claims-paying ability of the insurer). If you die during the coverage period, your beneficiary receives the policy death benefit. If you live to the end of the term, the policy simply terminates, unless it automatically renews for a new period. Term policies are available for periods of 1 to 30 years or more and may, in some cases, be renewed until you reach age 95. Premium payments may be increasing, as with annually renewable 1-year (period) term, or level (equal) for up to 30-year term periods.
Permanent insurance policies provide protection for your entire life, provided you pay the premium to keep the policy in force (subject to the claims-paying ability and financial strength of the insurer). Premium payments are greater than necessary to provide the life insurance benefit in the early years of the policy so that a reserve can be accumulated to make up the shortfall in premiums necessary to provide the insurance in the later years. Should the policyowner discontinue the policy, this reserve, known as the cash value, is returned to the policyowner, subject to applicable surrender or early withdrawal charges. Permanent life insurance can be further broken down into the following basic categories:
- Whole life: You generally make level (equal) premium payments for life. The death benefit and minimum cash value are predetermined and guaranteed. Any guarantees associated with the payment of death benefits, income options, or rates of return are based on the claims-paying ability and financial strength of the insurer.
- Universal life: You may pay premiums at any time, in any amount (subject to certain limits), as long as policy expenses and the cost of insurance coverage are met. The amount of insurance coverage can be changed, and the cash value will grow at a declared interest rate, which may vary over time.
- Variable life: As with whole life, you pay a level premium for life. However, the death benefit and cash value fluctuate depending on the performance of investments in what are known as subaccounts. A subaccount is a pool of investor funds professionally managed to pursue a stated investment objective. The policyowner selects the subaccounts in which the cash value should be invested.
- Variable universal life: A combination of universal and variable life. You may pay premiums at any time, in any amount (subject to limits), as long as policy expenses and the cost of insurance coverage are met. The amount of insurance coverage can be changed, and the cash value goes up or down based on the performance of investments in the subaccounts.
Life Insurance for Individuals
Life insurance is an agreement between you (the insured) and an insurer. Under the terms of a life insurance policy, the insurer promises to pay a certain sum to a person you choose (your beneficiary) upon your death, in exchange for your premium payments. Appropriate life insurance coverage may provide you with a feeling of confidence since you know that those you care about should be financially protected after you die.
The many uses of life insurance
One of the most common reasons for buying life insurance is to replace the loss of income that would occur in the event of your death. When you die and your paychecks stop, your family may be left with limited resources. Proceeds from a life insurance policy make cash available to support your family almost immediately upon your death. Life insurance is also commonly used to pay any debts that you may leave behind. Life insurance can be used to pay off mortgages, car loans, and credit card debts, leaving other remaining assets intact for your family. Life insurance proceeds can also be used to pay for final expenses and estate taxes. Finally, life insurance can create an estate for your heirs.
At Hershenberg Stone-Walsh Insurance we work with our clients to help them find the right type of policy and to determine the amount of life insurance they need. We work with many of the top life insurance companies to ensure that our clients receive the right policy at the best price.