Life Insurance
As Independent Agents, we are not captive or bound to any carrier. We can independently shop and offer products that best serve our clients.
Life Insurance proceeds are tax free, and we offer the following types of insurance:
Term Life Insurance
Term Life is the least expensive type of Life Insurance because expires at the end of the term, and has no residual value. Term lengths are 10, 15, 20 and 30 years.
“Return of Premium” Term Insurance
A recent innovation, “Return of Premium” (ROP) Insurance is a hybrid between cheaper Term Life, and the more expensive Permanent Life.
ROP term is like simple term because it will expire. BUT, it retains a residual value that will be paid to you at the end of the policy term. This residual value is equal to ALL premiums paid into the policy over the term of the policy. In essence, an ROP policy serves as a savings account, similar to traditional whole-life/UL permanent insurance. For Example, a 20 year policy that costs $1,000 per year – the Insurance will send a check for $20,000 to the policy owner when the policy expires.
Permanent Insurance (UL or Whole Life)
Permanent policies are owned by the policyholder and will never expire. As such, they are the most expensive. Of course, expense is relative if you take into account how well the policy will accumulate cash values; cash that you own. Usually by years 10-15 into the policy, you will have account values (i.e. cash values) that will exceed monies paid into the policy. Moreover, these values can grow and eventually reduce the premiums needed to sustain the policy; if no premiums would be needed, it’s considered “Paid-Up”. In effect, these accumulating values and “Paid-Up” provisions make a permanent policy theBest Value, even though you'll need to pay in higher dollar amounts for this policy in earlier years.
Whole Life vs. Universal Life
Whole Life is a more traditional policy, and it requires the premium to be regularly paid for the entire life of the policy. It can reach “Paid Up” status if dividends perform, but dividends aren’t guaranteed.
Universal Life Insurance is a more updated and flexible policy form. It’s also more client friendly because it allows the client to vary premium payments. If any cash values are available, they can be used to pay or offset premiums.
More Consumer information can be found at the California Department of Insurance website link for life insurance.
More information about Life Company guarantees can be found at The California Insurance Guarantee Association.
Disability Insurance
Individual disability protects your most valuable financial asset: your income. There is a much greater possibility that you’ll need this type of insurance as opposed to Life Insurance. Disability policies are designed to replace anywhere from 45-60% of your gross income on a tax-free basis should a sickness or illness prevent you from earning an income in your occupation. Every disability insurance policy from every insurance company is different, this is not a product to simply shop for the most competitive rate. To buy the cheapest disability insurance policy on the market is to throw money away. The odds of getting paid a monthly benefit under a cheap contract may be significantly lower than receiving benefits from a quality contract.
What are the odds you’ll need disability??
I think the first thing to go over is to define a benefit period. Try to explain what it is, and even more importantly, what it is not.
A benefit period is the period of time you are eligible to collect benefits while on a disability insurance claim. If a sickness or injury occurs that prevents you from performing the material and substantial duties of your occupation, the elimination period begins. Once the elimination period has been satisfied, monthly benefit checks will begin to come in at the end of the month. The maximum amount of months that these checks can possibly come in is your benefit period. Your benefits stop when you return to work in your occupation, or depending on the contract to another occupation making the same income.
Possible Benefit Periods
A popular choice for a disability insurance policy is To Age 65. The bottom line is if you are permanently disabled your last benefit check is on your 65th birthday. I never recommend a two year benefit period unless you already have another policy that has a two year elimination period.
Data compiled from the Society of Actuaries.
Disclaimer: Important Notice: The information published at this web site is not intended to be a recommendation to purchase Life Insurance. Cash Value Life policies are not deposits of or guaranteed by any bank and are not insured by the FDIC or any other agency of the U.S. government. You are strongly urged to consult with financial planning, tax, and legal advisors to determine if Life Insurance is suitable in your financial situation. All Insurance guarantees are subject to the financial strength of the insurance company.
Some of the Life Companies we work with are:
The hyperlinks provided are intended for informational purposes only and are not to be interpreted by the recipient as a solicitation or endorsement.
Gregory McCloskey - CA Insurance License # 0B72919 California Department of Insurance