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LIFE INSURANCE FOR INDIVIDUALS
If you have any questions or need additional assistance
PLEASE CALL 713-957-8100 or submit a help request.
Protect the people you love the most. When you can’t be there, life Insurance helps pay for final your expenses, your mortgage, your taxes, and the living expenses of your loved ones when they no longer have your income. It can also cover your children’s education and more.
Basic Types of Life Insurance
Cash Value: This type of life insurance policy builds up a cash value that has many benefits to the insured, such as borrowing against the policy or building a tax deferred investment income, in addition to paying a death benefit. Whole life, variable life and universal life are all types of cash value life insurance. Cash value insurance is also known as permanent life insurance because it provides coverage for the policyholder's entire life.
Term Life Policy: This type of coverage does not build cash or investment value. Term life insurance covers you for a set period of time provided you pay the monthly premium, or in some instances, a lump sum in advance. The policy will pay to the named beneficiary the face amount of the policy (set benefit and/or lump sum) upon death of the insured within the stated term. Depending on the policy, it may also make payments upon terminal or critical illness.
Whole Life Policy: This type of coverage combines term life coverage with an investment fund, and as long as you pay your premiums you are covered for life. Part of your premium goes towards the term part that pays a fixed benefit upon your death, and part of your premium goes toward building taxed deferred cash value that you can borrow against. Some whole life policies offer plans in which you can pay a higher premium for a shorter, fixed period of time, such as 20 years, vs. your whole life.
Universal Life Policy: This type of policy combines term insurance with an interest earning money market account. It has flexible terms that let you adjust your payment or coverage amount. Because this account incurs expense charges, you will need to adjust accordingly to make sure your coverage stays active, in the event that the amount in your account becomes insufficient to meet premium payments. You also have the option of building more cash value by paying premiums even when your account has ample funds to cover them.
Variable Life Policy: With this type of coverage, the death benefits for the life insurance policy are based upon how well the investment account it is tied to is performing (stocks, bonds or mutual funds). Higher performance yields higher benefits, wherein poor performance will yield lower or no benefits at all. Some policies offer a separate or extra premium for a set amount to be paid upon death of the insured.
Life Insurance can be complex. We recommend your call an expert at Northwest General Insurance and Financial Services for more details.