Wednesday, March 16, 2011

Life Insurance Policy

If you are looking for a life insurance policy which does not expire and comes with a death benefit and a savings portion, Permanent Life insurance policy is the right option. Under this policy, the policy owner can borrow funds against this savings portion. The owner can even withdraw the cash value to meet necessities like paying for a child's education. With a Permanent Life insurance policy, you can enjoy the growth of cash value generally on a tax-deferred basis, so you do not need to pay taxes on any earnings in the policy as long as the policy remains active. Also, no taxes would be deducted when you can withdraw an amount upto the amount of premium paid. The two main types of permanent life insurance include whole and universal life insurance.
permanent life insurance offers more flexibility to the customers when premiums are to be paid. With this policy, you can even withdraw cash from the policy without paying the interest associated with the loan provisions in whole life policies. This policy provides greater returns than other permanent life insurance policies and offers favourable tax treatment compared to other permanent life insurance policies.

Making a decision which life insurance policy you should get can be challenging especially if you lack the proper knowledge to make wise choices. Keep in mind that there is no definite answer which type is the best because individuals have different incomes and a variety of needs as well. Your insurance should suit these factors and you cannot simply get a policy just because someone you know has the same plan as well.
If you haven’t checked the available resource materials online just yet, you generally have two choices. You can either get a term insurance or a universal insurance if you want to. The former would only cover you for a certain period of time, but they are completely renewable and far cheaper than the latter. On the other hand, universal insurance would give you a chance to be covered for life. Even if you are going to be in your twilight years already, you would still be protected financially by this plan.

1. You should select a life insurance broker who knows about your financial objectives and goals, your risk tolerance and your death benefit considerations, and insurance premium rates.

2. The life insurance broker you choose should be well aware of all the life insurance plans available in the market and be should also be able to tell you about all their advantages and disadvantages on the insurance policies. He should not pressurize you to purchase any specific policy or he should not have any preferences regarding one life insurance company to the other.

3. An experienced and qualified life insurance agent will have good relationships with most of the insurance companies out there, he should be able to offer you more options to select from and he should advise you while you are trying take your final decision. He should be able to answer all your queries in terms of different insurance policies including their insurance rates, tax benefits, shortcomings, ease of changing the beneficiary and flexibility of adding the riders.

4. He should have extensive knowledge of insurance policies and should have enough experience to steer you through your doubts and queries. Keep in mind that an inexperienced agent or broker can provide you wrong information which may potentially risk you in getting a wrong life insurance plan, or costing your more in insurance premium.

5. The main thing you should look in a life insurance broker is that he should have the appropriate licenses as per your state rules. Such a broker will not work for his own benefits but only for the welfare of his clients.
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