Solving the mystery of life insurance

You should consider life insurance if you:

• Have a spouse or life partner,
• Have a child or other relative who depends on you for support,
• Own a business,
• Have a large mortgage payment,
• Have a sizeable estate, or
• Are concerned your savings or retirement is not enough to insure your family’s future against the rising cost of living.

Many people think that life insurance is confusing and are unsure whether or not they've purchased the appropriate policy for their individual situation. But life insurance is probably much easier to understand than you think, and choosing the right policy can provide financial security in the future. And knowing you've made appropriate provisions for your family in the event of your death can give you tremendous comfort.

Life insurance helps your loved ones by providing them with immediate funds to pay final medical expenses, funeral costs and other miscellaneous bills, payable on an income tax free basis. There are many types of life insurance policies from which to choose. Selecting the right one may seem difficult, but it doesn't have to be. The following list can help you understand what policies are available to you. Then, contact me to discuss your personal situation and insurance needs. Together, we can select a policy most in line with your goals.

Term

If you’re looking for protection that insures you for a fixed period of time at a relatively low cost, consider term life insurance. If you die during the period covered by the policy, it will pay a benefit. However, unlike other life insurance contracts, term life policies do not build cash value. This means you may not withdraw or borrow against the funds at any time. In addition, term life insurance usually is discontinued after the specified term insurance period.

Whole

As its name suggests, a whole life policy provides protection for your entire life. Whole life insurance has a guaranteed premium outlay, a guaranteed death benefit and guaranteed minimal cash value. Many companies also may pay policyholders an annual dividend; however, these are not guaranteed. The policy's primary purpose is protection for the life of the insured.

Fixed universal

Similar to whole life insurance, fixed universal life is designed to provide insurance coverage for the life of the insured. The insurance company credits an interest rate to the policy cash value based on current economic conditions. There is a minimum guaranteed crediting rate. Universal insurance offers a wide range of choices regarding death benefits and/or premium payments, allowing you to choose how much will be paid and when. The policy owner may access the cash value via withdrawals and loans. In addition, guarantees may be designed into the policy.

Variable Life Insurance

Designed for growth, this policy allows you to invest the cash value of the policy into various investment alternatives. This affords cash value the potential to grow at a faster rate than it would in another type of plan.

• The insurance amount is designed to be level or increases as the policy cash value increases.
• Policy cash value fluctuates according to underlying investment performance.
• Cash value and death benefit may be invested in sub-accounts containing domestic or international stocks, bonds, real estate and other, more speculative investments.
• Higher cash values and death benefits may be obtained or lost due to the financial climate and investment performance.
• Investment earnings are income tax-deferred.

For more information on selecting the right policy for you, please contact us.

Investors should carefully consider the investment objectives, risks, charges and expenses of variable life insurance before investing. The prospectus contains this and other information about variable life insurance. The prospectus is available from our office and should be read carefully before investing.

There are fees and charges associated with variable life insurance policies. Charges vary based on the circumstances of the insured life. Surrender charges vary by issue age, risk class and gender. Loans and partial withdrawals will decrease the death benefit and cash value and may be subject to policy limitations and income tax. A 10% federal tax penalty may also apply if the loan or withdrawal is taken prior to age 59½. All guarantees, including death benefits, are subject to the claims-paying ability of the issuing insurance company. An investment in variable life insurance involves risk, including possible loss of principal. Investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than the original investment.