Life insurance protects against the potential financial loss experienced as the result of the
death of a loved one. However, certain types of life insurance policies can also be valuable
Permanent or Whole Life Insurance provides coverage to the policyholder until his or her death at
which time the policy will provide a payout to the beneficiary(ies) based upon the face value
of the policy. Additionally, some permanent life insurance policies may place part of the
premium into a savings fund that can be used by insured later in life.
Term Life Insurance provides coverage for a limited amount of time known as the “term”.
Many people buy term life insurance insurance because the premiums are much less
expensive than whole life insurance policies. Typical term life insurance policy durations can
be 5,10, 15, 20 or 30 years. These type of policies can be great for young families who are
looking to protect their children without paying high premiums.
If you are considering shopping for Life Insurance NJ it is important to remember the effect
your age will have on your policy premiums. It is wise to invest your money into life
insurance earlier rather than later because the policy premiums will increase with age.
What is the meaning of the word “beneficiary” in life insurance policies?
The beneficiaries are the persons or financial institution, one can designate to receive the
payout from a life insurance policy. If there is no live beneficiary, the proceeds from the
policy will become part of the estate. A policyholder can designate a beneficiary and can
change the beneficiary when needed to keep the policy up-to- date.
There can be many major changes in life such as marriage or divorce, a born or adopted
child, having the financial responsibility of an aging parent, or new home ownership or even
refinancing your home. It is important that Life Insurance NJ policyholders check who the
beneficiary is in their policies in order to ensure the policy is up-to- date with their most
recent life changes.
Why Buy Life Insurance?
Most financial experts agree that life insurance is an important cornerstone of sound financial
planning. Still it is important to understand why life insurance is such an integral part of
most good financial strategies.
A few reasons purchasing life insurance is important:
Estate planning: Life insurance policies are designed to pay estate taxes so that the next
generation does not have assets in liquidity.
Income replacement: One of your key assets is your ability to continue to earn a living. If
you have a dependent, a life insurance policy helps to guarantee that they be financially
protected in the event you die and are no longer able to earn an income. Some people also
utilize the cash value of permanent life insurance policies to take loans during major life
events such as kids going to college or retirement.
Payment of Debts and Funeral Costs: Life insurance should also be considered as a tool
for protecting your loved ones against the costs associated with burial costs, medical
expenses not covered by the health insurance, and any other outstanding debts so that they are
not dealing with financial burden during an already difficult time.
Charitable Donations: Some people name their favorite charitable organizations as the
beneficiary in their life insurance policy as a way to donate to the organization.
If you live in New Jersey and are looking for great rates on a high quality life insurance policy contact us today!