What life insurance policy should I get? At some point in your life, you will come to the conclusion that you need to purchase life insurance. You have a good idea of how much you need, but deciding which life insurance policy best suits your specific needs is another matter. There are many options. It may be that if we look at the various reasons people buy life insurance and which policy meets particular needs, it’s easy to make a decision. Here you have it.
Mortgage Life Insurance Protection
Most people have the desire to own a home at some point. Some of them are small and cozy and look like beds. Others are taller and may appear to show wealth and success. One thing they all have in common is that this property is very important to its owners. Sometimes pride of ownership is what drives a person to buy a home. In other cases, this house is purchased because the couple simply wants to have a house for the family. They want their children to know that it is their home.
You take out home insurance to protect your home in case of fire or any type of accident that could destroy it. You should also take out mortgage insurance in case the person paying the mortgage dies. One of the best policies to use is a decreasing term life insurance policy. You buy this policy for the term of the mortgage…for example, 20 years. Upon your death, the insurance company pays the beneficiary an amount equal to the balance owed…
So that they have a free and clean house. Some people, for example, prefer to use a 20-year life insurance policy. If you die in the first year, the same amount will be paid to your beneficiary, but if for example you die in the tenth year, there will be enough money to pay the mortgage, but there will be a lot of money that your loved one, those will certainly be welcome.
One of the main reasons to purchase a life insurance policy is to protect your family in the event of an untimely death. They will need money to pay for recent expenses such as burial costs, probate fees, attorney fees, and of course the large property taxes. Although Congress repealed the estate tax, it was done pretty gradually until 2010…so the point is that if you’re in that tax bracket, you have to pay estate taxes when you die.
You should also keep in mind that your family still needs your income after your death. You need a policy whose proceeds can be paid as income. The best way to do these things is to buy one life insurance policy to meet your cash flow needs and another life insurance policy to provide you with income when you die. In any case, the most commonly used policies are 20-year life insurance policies, 25-year life insurance policies, or 30-year life insurance policies.
Some people like universal life insurance, variable life insurance, variable universal life insurance, or whole life insurance. These life insurance policies include monetary values that you can use during your life.
Business life insurance needs
Small business owners need different life insurance policies than individual or family protection needs, although the focus is always on the rest of the family. A corporation or business partnership will purchase a life insurance policy for each of the partners or shareholders that will provide enough cash to purchase the shares of the deceased partners or shareholders from their heirs. An agreement of sale is drafted by an attorney. It is financed with life insurance and is mandatory. Most business owners use a 20-year life insurance policy or a 30-year life insurance policy for this purpose. All permanent cash value policies can also be used.
Business owners can also purchase life insurance to protect the business against the loss of a valuable key employee. The company will be the borrower and also the beneficiary. Upon the death of the key employee, the cash from the life insurance policy will be used to help keep the business afloat while a capable replacement is found.