Silver Insurance Solutions
Silver Insurance Solutions
What Is Term Life Insurance?
Term life insurance, also known as pure life insurance, is life insurance that guarantees payment of a stated death benefit during a specified term. Once the term expires, the policyholder can either renew it for another term, convert the policy to permanent coverage, or allow the policy to terminate.
The basis for term life premiums is on a person’s age, health, and life expectancy, which is set by the insurer. If the person should die within the specified policy term, the insurer will pay the face value of the policy.
Term life policies have no value other than the guaranteed death benefit. There is generally no savings component as found in a whole life insurance product. There are some RETURN of premium policies but they are more expensive. (It says what it does, at the end you get most of the money you paid for the policy back)
The policy's purpose is to give insurance to individuals against the loss of life. This cash benefit may be used by beneficiaries to settle the policyholder's healthcare and funeral costs, consumer debt, or mortgage debt among others. Term life insurance is not used for estate planning or charitable-giving purposes. All premiums cover the cost of underwriting insurance. As a result, term life premiums are typically much lower than permanent life insurance premiums.
Because most term life insurance policies expire before paying a death benefit, the overall risk to the insurer is lower than that of a permanent life policy. The reduced risk allows insurers to pass cost savings to the customers in the form of lowering premiums.
Term insurance comes in three different flavors, depending on what works best for each person.
These provide coverage for a specified period ranging from 10 to 30 years. Both the death benefit and premium are fixed. Because actuaries must account for the increasing costs of insurance over the life of the policy's effectiveness, the premium is comparatively higher than yearly renewable term life insurance.
(YRT) policies have no specified term but are renewable every year without requiring evidence of insurability each year. Early on, premiums are low, but as the insured ages, premiums increase. Although there is no specified term, premiums can become prohibitively expensive as individuals age, making the policy an unattractive choice for many.
These have a death benefit that declines each year according to a predetermined schedule. The policyholder pays a fixed, level premium for the duration of the policy. Decreasing term policies are often used in concert with a mortgage to match the coverage with the declining principal of the home loan.
Convertible Term Life
Convertible Term Life Insurance is a term life policy that includes a conversion Rider. The rider guarantees the right to convert an in-force term policy—or one about to expire—to a permanent plan without going through underwriting or proving insurability. The conversion rider should allow you to convert to any permanent policy the insurance company offers with no restrictions.
The primary features of the rider are maintaining the original health rating of the term policy upon conversion, even if you later have health issues or become uninsurable, and deciding when and how much of the coverage to convert. The basis for the premium of the new permanent policy is your age at conversion.
Of course, overall premiums will increase significantly, since whole life insurance is more expensive than term life insurance. The advantage is guaranteed approval without a medical exam. Medical conditions that develop during the term life period cannot adjust premiums upward. However, if you want to add additional riders to the new policy, such as a long-term care rider, the company may require limited or full underwriting.
I usually suggest always writing one of these policies when possible.
This is for older clients who don't want to burden their loved ones with after-death expenses, an unpaid medical or on going household expenses. OR I have clients who have such grave health problems that they are not able to get any other kind of life insurance.
These are Guaranteed Issue as a simple, affordable, benefit-packed product. It is designed to provide clients with comfort and peace of mind for just a few dollars a day. It also includes benefits typically available only in more expensive policies.
BEST OF ALL: Acceptance is guaranteed. No one can be refused! From application to policy issue, the process is simple, short and pain-free.
I can talk to you and fill out the application in a matter of 15 minutes and by the end of the phone call have your Policy already issued and give you your policy number. EASY! You can also pay by ACH, Social Security debit card, or credit card.
It also includes accelerated benefits automatically included! What is that? If you get diagnosed with a chronic illness or a terminal illness, the policy will let you take a one-time lump sum payment up to 50 percent of the policy's face amount with no waiting period.
What is the catch?
These policies will not pay out anything but a return of premiums of 110% in the first 2 years.
The full face amount is not activated until the 3rd year. If you commit suicide, just premiums are refunded anytime.
They are not going to pay if you die by taking illegal drugs or decide you suddenly want to become a bungee jumper or those kinds of activities!
It is a great product!
What is whole life? Whole life insurance covers you as long as you live. You have to pay the same amount of premium for a specific period to receive the death benefit.
Whole life insurance caters to long-term goals, offering consumers consistent premiums and guaranteed cash value accumulation.
These policies are typically comprised of two parts: a savings or investment portion and an insurance portion. This makes the premiums higher than normal policies. Insured people can also take a loan by borrowing against the cash value. For this reason, permanent life insurance is also known as cash-value insurance.
If, for whatever reason, you want to cancel your permanent life policy, you will get your cash value in hand and can use it as needed, for example, at the time of emergency.
Here's how it works. Your insurance company puts part of your money into a high-interest bank account. With every premium payment, your cash value increases. This savings element of your policy builds up your cash value on a tax-deferred basis. In a way, the presence of guaranteed cash values makes this policy worthwhile because you can borrow against your cash value or surrender your policy to get the cash value.
You can also opt to participate in the surplus of your insurance company and receive the dividends annually. Here again, you have the choice to either get your dividends in cash or let them accumulate interest. You may also use your dividends to reduce your policy's premiums or buy additional coverage.
Whole life insurance is made to fulfill an individual's long-term goals and it is important that you keep it going for as long as you live.
Once you have accumulated enough cash value, you can tap into it to cover premium payments. This is known as being “paid up.” The vast majority of life insurance companies are willing to honor this request—all you have to do is ask. Using this tactic, you could save $2,000 or more in premiums each year.
I think this is a great idea for your kids or grandkids!
These are simplified issue plans from the ages of 14 days to 17 years.
Some policies will double when they turn 18 at no additional raise in premium guaranteed issue. So a $25,000 policy becomes a $50,000 at no additional cost.
Then there is another policy that will let you purchase that same amount up to 5 times in their life guaranteed issue!
All the while these policies are growing cash value, are the lowest premium whole life policy you will ever find and can be kept for the entire life of the child.
A simple $25,000 policy as a child can become a $150,000 policy, plus all the cash value you can accumulate during the life of this policy.
OR you could purchase a participating whole life policy on the life of your child which will slowly build death and cash values for their entire life. They end up with more by the time they are 40 but will also pay more in premiums.
Long term care is something that is generally needed. The best thing is if your life insurance policy covers this kind of policy or can be added as an accelerated death benefit rider. It is always the cheapest and best option- however: some folks get to the place where they are not able to get a rider or policy so this is where stand alone long term care insurance steps in.
What is it?
This type of insurance will pay or reimburse you for some or all of your long-term care costs. It may include help with activities of daily living, home health care, respite care, hospice care, or adult day care. Care may be given in a nursing home, an assisted living facility, a hospice facility, a day care facility, or in your own home.
HOW DO THESE POLICIES WORK?
They are generally pay benefits using one of three different methods.
1. Expense-incurred method: it pays benefits only when you receive eligible services. The insurance company must decide if you're eligible for benefits and if your claim is for eligible services. The coverage pays for either the expense or the dollar limit of your policy, whichever is less. Most policies today are this kind.
2. Indemnity method: The benefit is a set dollar amount. The benefit isn't based on the specific services you received or on the expenses incurred. The insurance company only needs to decide if you're eligible for benefits and if the policy covers the services you're receiving. Once it makes that decision, the insurance company pays that set amount directly to you, up to the limit of the policy.
3. Disability method: You are only required to meet the benefit eligibility criteria. Once you do, you receive your full DAILY benefit, even if you aren't receiving any long term care services.
All policies will have a maximum benefit limit, a daily/weekly/monthly benefit limit, a benefit trigger event, elimination period (how long you have to have the benefit trigger to when the plan will pay: 1,30,60 day and so on), and non forfeiture benefits.
Optional additions are inflation protections, third party notice, waiver of premium when benefits are paid, premium refund at death and downgrades.
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