Life Insurance Information

Life insurance is great for individuals that have a family, dependents and earn the most income to support their family. Life is unpredictable and it is important to ensure your family and loved ones are taken care of financially in case anything happens to you.

When shopping for life insurance in South Carolina, searching online and using the internet's resources are a great way to educate yourself on life insurance basics, shop and compare quotes for the best life insurance policy for you. There are three different types of life insurance policies - universal life insurance, cheap whole life insurance and cheap term life insurance.

Universal Life Insurance

Combines life insurance with savings. Insurers are able to have the benefits of term life insurance and combine that with tax-deferred interest accumulating savings account. Sometimes you may not even have to pay premiums during the entire policy. If your money to pay the death benefit and other costs accumulates in the tax-deferred savings portion of your policy, then premiums may not be required to keep the policy in force.



Cheap Whole Life Insurance

This type of policy will cover you for your entire life. Your death benefit and premium generally remain the same. Whole life insurance also builds cash value, which could enable you to earn a return on a portion of your premiums that the insurance company invests. Your cash value is tax-deferred until you withdraw it and you are also able to borrow against that money.



Cheap Term Life Insurance

This type of life insurance is low cost and great for young healthy individuals who are healthy and may not be able to afford cash-value life insurance premiums and want to ensure their dependents are taken care of in the event of death. Your policy will cover a pre-determined "term" which is normally one, five or ten years. Your premium payment and death benefits are only during that term. After the term you will have options to continue coverage and have the opportunity to convert to a cash-value life insurance policy.


 

Universal Life Insurance

Universal life insurance combines cheap term life insurance with a tax-deferred interest accumulating savings account. This life insurance plan provides insurers with death benefit as well as incorporating savings abilities.

Investing

Universal life insurance is also known as "flexible premium adjustable life insurance," and gets this term because it is somewhat of a flexible version of cheap whole life insurance. Your insurance company will take a portion of your premiums and invest them in bonds, mortgages and money market funds. You earn the return on said investments which is credited to your policy tax-deferred. You usually receive a guaranteed minimum interest rate which is not dependent upon the performance of your investments so you will always get a certain minimum return on your money. When your investments do well, normally the insurance company will increase your interest rate return.

Death Benefit

You generally have two options when setting-up your universal life insurance policy. One option will pay your death benefit out of your policies accumulated cash value. This policy costs less in premiums, but it can take a while to build up sufficient benefit. The other option will pay you a face value that you agree upon in the contract plus your accumulated cash value. This option cost more in premiums, but you are guaranteed at least a specific amount of money in your death benefit. Most life insurance companies can set your policy up so you will have a no-lapse guarantee as long as you pay your minimum designated premium. The policy could stay in force to age 100 or above. Universal life provides you the flexibility to adjust your death benefit according to your needs allowing you to pay smaller or larger amounts depending on your finances.

Cheap Whole Life Insurance

Cheap whole life insurance policies cover you for life. Generally your death benefit and premium will always stay the same. Cheap whole life insurance builds cash value which is tax-deferred until you decide to withdraw it or borrow against it.

There are different types of cheap whole life insurance. These include traditional, interest-sensitive and single-premium whole life insurance policies.


Traditional whole life insurance

This policy gives you a guaranteed minimum rate of return on your cash value segment.


Interest-sensitive whole life insurance

Provides a variable rate on your cash value portion which is comparable to an adjustable rate mortgage. This gives you the flexibility with your cheap whole life insurance policy such as increasing your death benefit without increasing your premiums depending on the economy.

Single-premium whole life insurance

This is great for individuals who have a large sum of money who would like to purchase their policy up front. This cheap whole life insurance policy also accrues tax-deferred cash value.


 One of the features that make cheap whole life insurance popular is that a portion of your premium money goes toward your cash value which could pay off your entire policy after a few years. Another advantage is unless you make a change to your cheap whole life insurance policy, you will be covered for life with no future medical exams.

Full Review of Life Insurance

What Is Life Insurance?

Life insurance provides protection against financial failure resulting from death. It is an insurance company's guarantee to pay a beneficiary a particular amount of money when an insured dies in exchange for appropriate payment of premiums.

What Is It Intended To Do?

Life insurance serves as refuge in the event of the insured's death. Life insurance gives financial fortification to survivors. It provides dependents with the needed funds to settle financial responsibilities and to compensate for the loss of income due to the insured's death. Life insurance policies are typically bought with a precise objective in mind - to protect a mortgage or an estate, to afford educational expenditures, for retirement, or for donations.

Why Is Life Insurance Essential?

People hold life insurance policies for countless reasons. Among the most frequent are to pay off a mortgage, or personal debts (car loans, credit cards), educational expenses for juvenile children, for beneficiaries to be able to uphold their present standard of living, for child care, for urgent financial needs, and for medical or funeral expenses.

How Can Life Insurance Needs Modify Over Time?

If an individual has completed raising their family, has paid off their mortgage and does not have any chief financial responsibilities, then their life insurance requirements will be less than when they were younger. A person may decide to no longer hold their policy or to decrease their coverage amount to a level just adequate enough to make certain that their survivors have sufficient funds to compensate final expenses upon the insured's death.

How Does Life Insurance Operate?

All aspects of life involve a certain level of risk, whether it is a fire, burglary, car accident, or injury. Insurance provides a way of shifting the financial penalties of particular risks from the person to an insurance company. When a person purchases life insurance, they are put together with other individuals who are comparable in age, sex, and health status, regardless of whether the company advertises a no medical exam term life insurance plan.

Actuaries estimate how many people in each group are expected to die in a range of time. The more deaths expected in a group, the more funds will be required to pay death claims, and thus, more money will have to be gathered as premium payments. Since younger people are not as likely to die as older folk, premiums are normally lower at younger ages.

Annually, the insured pays the company for their policy. These funds are called "premiums." The insured also notifies the insurance company of who the beneficiaries of the insurance money are in the event that they (the insured) die. This is referred to as "designating a beneficiary."

If the insured dies during the active period of their policy, the life insurance company will disburse the insurance money to the designated beneficiaries. Insurance companies can do this because only a small amount of people die annually, while many more individuals pay them premiums. The "risk" of death is allocated among many people to avert a financial loss to the beneficiaries of the people who do actually die.


What Is An Actuary?

An actuary is an individual who is professionally qualified in the technical facets of insurance, principally in the mathematics of insurance, such as measuring premiums, dividends, and appropriate policy reserves. Actuaries help in approximating the price of executing new benefits or benefit improvements and also perform statistical and financial studies. Actuaries in the U.S. attain professional status by passing a set of tests given by the Society of Actuaries (SOA).

Where Does The VA Insurance Program Get Its Actuarial Expertise?

The Insurance Actuarial Staff is situated at the Insurance Center in Philadelphia, Pennsylvania. The Actuarial Staff is accountable for the financial management and actuarial reliability of the life insurance programs that are managed and overseen by the Department of Veterans Affairs Regional Office and Insurance Center.

Among the staff's tasks are the calculation of premiums and dividends, measuring policy values, developing mortality and insurance knowledge studies, implementing suitable reserve levels and financial coverage. The Actuarial Staff is also responsible for the assessment of the financial impact of legislative suggestions that will influence life insurance programs.

The Actuarial Staff is accountable for the groundwork for financial statements released by the VA life insurance programs. These statements display the financial standing of each of the types of life insurance programs. Annually, independent auditors review these statements to make certain that the statements correctly reflect the financial standing of the various programs.

This is significant because an approving audit judgment means that the life insurance programs are competent enough to meet their responsibilities to policyholders and that all policyholders are being cared for fairly. For each fiscal year since 1992, the VA insurance program has been the recipient of an incompetent audit judgment. This means that the independent auditors have come to the conclusion that the financial statements correctly reflect the financial standing of the insurance programs.

Life Insurance

Life insurance is unique among financial instruments. It is one of, if not the only financial instrument that is based on caring and love. Even though there can be personal advantages to having life insurance, the real impetus is love for those one cares most about – to make sure they are taken care of. So, applaud yourself for taking the time to learn about this subject (and please follow up with action whether through us or the organization of your choice.)

Interestingly, while one is taking care of the financial needs and wants of a spouse or the next generations, life insurance can also develop and build one’s personal financial goals while living. For example, because you have sufficient life insurance, you might be able to use more of your assets to enjoy life in retirement. Why is that? Because if you know you have sufficient life insurance you won’t feel that you are lowering the inheritance by spending some of your principal. You may actually “pay down principal” to some degree to yourself, especially if you have lifetime permanent life insurance as a backup.

There are various types of life insurance but they all have some common attributes. You pay an insurance company what are called premiums. At your death, the life insurance company pays an amount to the people you named in your policy, called beneficiaries. Also it’s interesting that if you named a beneficiary(ies) they’d receive the insurance amount free of income tax.

Some types of life insurance have cash benefits available while you’re living. In these types, a portion of your premium goes into a cash reserve and builds on a tax deferred basis. You can access this money, called cash value. Some people use it to help education costs, enhance retirement cash flow or for any reason. Two of the most common types of “permanent life insurance” are called whole life insurance and universal life insurance.