Benjamin Franklin was once quoted saying, " in this world nothing can be said to be certain, except death and taxes.” It is interesting that he would have chosen these two topics of both death and taxes. The life insurance industry has zeroed in on these two specific concerns and have crafted solutions to soften the blow.
Let's start with the obvious: death. No one is immortal (yet... with technology and all). The average age of life expectancy has continually climbed for the past 40 years. However, the body still expires. The life insurance industry, namely the actuaries, study these trends and historical data incessantly. Causes of death are not the primary focus, it's when you die. There are life insurance policies that are available from age zero to one hundred years old. Some policies offer coverage for a specific term of time. If you do not die within that time period, the policy expires and there is no more coverage in the event of death. Think of it like your auto insurance. If you pay for auto insurance for one year and never have an accident or claim and do not renew the coverage, the policy expires and there is no more coverage. In either case, no money is return to the policy holder.
The other type of life insurance is whole life. It is designed to cover you for your whole life. If this policy is kept in force (payment are always made), it will never be cancelled and will pay a death benefit when you die. The cost of this insurance steadily and gradually increases as you advance in age due to the simple fact that it will eventually pay a death benefit.
The life insurance industry has also created solutions to help with the certainty of taxation. All death benefit monies paid out in the event of death are tax free. Life insurance proceeds are not taxed. Additionally, certain whole life policies allow the option for accumulation of cash value with a rate of return tax deferred and are sometime tax free.
There are hundreds of life insurance companies. All of them have numerous different life insurance products that service specific needs. Get with an independent insurance agent to discuss and discover what might best fit your needs.
Stickler Webb Insurance is an independent insurance agency with offices in Show Low, Safford and Sierra Vista, Arizona. Please visit, www.sticklerwebb.com for more information.