stock market technical analysis: The Basics of Term Life Insurance

In case of "buy term and invest the rest" or feeding your life insurance with "the power of the cash value"?
Term life insurance is often praised for its "pure insurance protection", which does not include any of the features of cash value policies inherent in life. Term life insurance covers you for a specific period of time - usually 10, 15, 20 or 30. You can also buy a term insurance that covers up to a certain age, usually 65 or 70. Insurance policies expire at a set time and if they die within no pay policy. If you die within the term, your beneficiaries receive the money tax free.
Usually, you buy a term life insurance to protect your loved ones from debts or provide short-term obligations. For example, if you and your spouse own a home and you were to die tomorrow, your spouse would have to pay the mortgage on their own. If you had a life insurance policy, your spouse could receive enough money from the death benefit of the policy to pay the mortgage.
Term insurance cover is not limited to specific debts, however. If you have children, term insurance can protect your family's finances, provide money for college and living expenses if you die before your children are grown.
General medical examination is required
When you apply for life insurance coverage, the insurance company will probably require a medical examination before issuing a policy. The basic test is covering your height, weight, medical history and blood and urine tests. With the blood and urine, the insurer seeks specific medical problems. Positive results may affect your premium, or even their ability to purchase a policy.
Smokers pay more for life insurance, although cigar smokers can get cheaper premiums than those using cigarettes. If you smoke marijuana, but not cigarettes, has yet to admit to being a smoker in the implementation of policies. Insurers normally do not differentiate between different types of smoke inhalation. (Marijuana users also must disclose their drug use.)
Different flavors of term
As you age, the likelihood increases that you will die sooner. That's why older people pay more for life insurance. However, life insurance affordable term is possible if you shop around. If you are looking for life insurance low cost long term, can block low premiums by purchasing a "term" policy level. That means that for a specific time period, say 20 years, your premium stays the same. Many long-term policies give you the option to renew coverage at the end of the word, without undergoing another medical examination, even though their premiums will rise for the next term - often substantially.
A less popular policy is the "annual renewable term." This covers you for one year with the option to renew each year for a period of time, say 20 years. With this policy, your insurance rates will rise each year of life is renewed and is calculated based on the probability of death in the coming year.
If you have a term life insurance rather than provide beneficiaries yet you are confident that you will survive the policy, you might consider the "return of premium" term life insurance. Under this policy, if no death benefit is paid at the end of the term of your insurance, you will get all your premiums back. It pays to shop around for a policy of this type, but at the lower end can expect to pay 50 percent more than in life insurance premiums comparable traditional term.
If you have trouble finding life insurance because of an illness or medical history with problems, you can turn the coverage guaranteed issue life insurance [http://www.insure.com/quotesmith/controller? REF = 99998 & reqid = qstermindex & redirx = x], sometimes called "quick question" or other insurance "simplified issue". Guaranteed issue policies require no medical exam, but you pay a higher premium in exchange for guaranteed coverage. This is because the insurance company assumes more risk in insuring people without knowing their medical condition. Guaranteed policies may require waiting periods before coverage kicks in. They might be the only option for some people. A life insurance broker can search the market for a guaranteed issue policy that fits your needs.
How long a term?
Find out what term should buy - 10 years, 20 years, 30 years or some other number - requires a thorough review of your debts, financial needs, the needs of dependents - and when all people can change. Jack Dolan of the American Council of Life Insurers suggests that you ask yourself, "When will my dependents achieve financial independence?" Also look at huge debts, such as mortgages or other loans, and when they are due to be paid.
Guenther Ruch Office of the Commissioner of Insurance of Wisconsin says it's a good idea to review your life insurance needs care, both at the time you buy the policy and regularly throughout their lives. "You may not have the coverage you need. You can have more than they need," says Ruch.
Ruch has the following recommendations for the purchase of life insurance to anyone, or anyone who already have coverage:

    Schedule a routine "check-up" with your insurance providers at least once a year.
    Shop around when you're in the market for a new policy. Term life insurance rates vary widely among insurers.
    Remember, an insurance policy is a legal document. Read it carefully and make sure you understand it.
"Maybe you want to leave property to his heirs, or charity, or if you need the death benefit for business planning purposes. All these are areas where life insurance can play a role, but it really is designed to financial protection, "Dolan says.
Term life insurance or whole: The cash value discussion
Variable universal life insurance (VUL), a form of permanent life insurance is popular because it offers a cash value that can accumulate over time with interest. Interest is based on the performance of stocks, bonds or other investment portfolios that invest their premiums.
Some financial advisers defend VUL policy because they force you to save money in the cash value component. Others recommend that you buy term insurance premium cheaper, and then invest the extra money in mutual funds or other investments. VUL also lets you change your death benefit and premium payments later in time.
The cash value of life insurance should not be considered a traditional investment because any partial withdrawals or loans will reduce the death benefit. Also, if you withdraw your cash value by an amount greater than the premiums paid on the policy, you will face a tax bill. In addition, each year you own the policy, the premium will more than pay for the cost of insurance for you and less goes to the cash value.
Amy Danise is a staff writer for Insure.com. Visit Insure.com for a comprehensive array of comparative quotes auto, life and health, including a large library of articles originally published insurance and decision making tools that are not available from any other source. Insure.com is dedicated to providing unbiased information to insurance consumers. Visitors can obtain instant quotes from more than 200 leading insurers, achieve maximum savings and have the freedom to buy from any company shown.

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Tuesday, November 27, 2012

The Basics of Term Life Insurance

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