Life insurance is perhaps the most important type of coverage you can purchase since it protects the people you love most against financial devastation in the event of your death. More than just coverage for funeral and burial expenses, life insurance has the ability to sustain your family’s financial health long after you are gone. If you have dependents or anticipate gaining dependents in the near future, now is the time to start thinking about updating your coverage or perhaps purchasing your first policy.
When to Purchase Life Insurance
Life insurance is time sensitive coverage for a few reasons. Generally, the sooner you purchase it, the lower your premiums will be. That is because life insurance rates are usually dependent upon various risk factors, such as age and health. Also, loved ones cannot purchase coverage after your death. Though you may expect to live a long, healthy life, there is no way to know what the future may hold. In other words, if you wait to buy coverage for your family, it could be too late.
Employer Coverage Trap
Many people delay purchasing a private life insurance policy because they are offered affordable coverage through work. In reality, you should think of employer coverage as a supplement to your primary coverage. While there is nothing wrong with having employer-based life insurance, you should also invest in your own private policy, too. That’s because employer coverage is often too low to meet your needs and is managed outside your control. Furthermore, you may lose employer life insurance coverage if you ever move to a different company or lose your job. At that time, getting a private policy may be more difficult or more expensive due to changes in your age and health.
Types of Life Insurance Coverage
When you shop for life insurance, you will have the option to choose from several different types of coverage. Most policies fall into one of two categories: term or permanent. Many people choose to lock in the lower rates of a permanent life insurance policy as soon as possible and then supplement that policy with term coverage as dependents come along. Our job here at Jarosch Insurance is to help you find a long-term financial solution that works best for you.
Term Life Insurance
Term life insurance pays a death benefit to beneficiaries when the insured dies before the completion of a specific term. In many cases, this is between 10 and 30 years, although some insurance companies offer terms outside those timelines. At the end of the chosen term, the life insurance is no longer valid, and the death benefit is canceled.
Even though term coverage does not last for life, it still offers many attractive benefits. Because of its limitations, the premiums for this coverage are typically very low in relation to the large financial benefit. It is not uncommon for households to purchase hundreds of thousands or even millions of dollars in coverage – all at a low, affordable price.
Having a high death benefit can help pay for a wide range of expenses after a passing – especially if the insured was a financial provider or caretaker in the home. Instead of feeling burdened by a loss of income or the need to hire in-home help, a family can maintain its financial living standards with minimal interruption.
If you decide term life insurance is right for you, be sure to select a term limit that will support your long-term goals. For example, if you expect to work several more decades and have young children in your home, a 30-year term policy may be enough to protect your loved ones until the youngest child finishes college and becomes financially independent.
We may recommend term life insurance for you if:
- You need low, affordable premiums
- You need a high death benefit
- You have household debt
- You need to provide income replacement
- You wish to fund a spouse’s retirement or a child’s education
- You wish to leave a substantial financial legacy for your family
- You want to protect your family’s business interests
- You wish to make a significant charitable contribution at your passing
Whole Life Insurance
A whole life insurance policy does not expire like term coverage does. Instead, the policy is effective for the entire life of the insured and cannot be canceled despite changes in your age or health. The premiums are also fixed for life, meaning they will never go up so long as you continue to pay them over time. As an added benefit, people who purchase whole life policies can accumulate cash value in those policies after several years of faithful premium payments. If necessary, you can borrow against that cash value tax-free and pay it back on flexible terms.
Whole life insurance may be right for you if:
- You want level premiums for life
- You want guaranteed coverage for life
- You want access to living benefits while you are alive
Universal Life Insurance
Universal life insurance is a more flexible version of whole life insurance. It has the same lifelong guaranteed coverage and cash accumulation, but the growth potential allows for greater flexibility in premiums than whole life policies provide. With universal life insurance, a portion of the premium goes toward the death benefit portion of the rate, and the remaining is invested. With optimal performance, the invested portion of the premium can eventually grow to pay for or lower the cost of the death benefit portion of the premium. This is especially beneficial during seasons where you may be without income or subject to limited resources.
Universal life insurance could be right for you if:
- You want premium flexibility
- You want guaranteed coverage for life
- You want both living benefits and death benefits
Affordable Life Insurance in Mesa, Arizona
If you need life insurance, we here at Jarosch Insurance can help you sort through your options to find a policy that meets your needs both now and in the future. We offer coverage from multiple insurers, making it easy to narrow down your options and find a competitive rate on the coverage you want and need.
For more information about Arizona life insurance or to request your free quotes, contact our office today.