Life Insurance 101

If you’re curious about some of the basics about life insurance, we’ve included general information here.

Want to learn more about how life insurance can benefit you and your family?

Types of Life Insurance

Not sure what the different kinds of insurance are or what the terms mean? Below are some basics to help explain what kind of coverage various options can provide.

Whole Life Insurance

Whole life insurance is permanent life insurance that provides protection for your entire life and offers financial support of a loss at any time.

Term Life Insurance

Term life insurance offers financial support of a loss only during a specified period. The premiums may be lower than whole life insurance premiums, but it won’t offer coverage for your entire life.

Accident Insurance

Accident insurance offers protection that pays you cash when you suffer an unexpected, qualifying injury.

Critical Illness Insurance

Critical illness insurance, also known as specified disease insurance, protects you and your family should a major medical diagnosis occur. It pays you lump sum benefits upon initial diagnosis of a range of medical diagnoses from heart attacks to cancer, to childhood diseases, to many other health conditions.

Disability Insurance

Disability insurance is income protection designed to help cover any income that is lost because of a disabling injury or illness.

Four Major Milestones and Insurance Options to Consider for Each

1. Summer camps – Whether it’s your youngster’s first day camp or your teen’s first weeklong overnight adventure, it’s always an exciting time for parents to see their children try new things and make the most of their days off. However, just as
you pack them the essentials to stay comfortable and safe at camp, you should also consider extra insurance options. Children will be trying so many new things and unfortunately sometimes the unexpected occurs. Accident coverage can complement your medical coverage, which can help with out-of-pocket expenses that you may incur as a result of an accident at camp or elsewhere.

Three Main Benefits of Investing in a Whole Life Insurance Policy

  1. 1. Guaranteed Cash Value
    Unlike term life insurance, whole life insurance accumulates a cash value that you can dip into during your life if a financial need arises. More importantly, as long as you pay your premiums, the cost of your policy will not increase, and the face amount and the interest rate are guaranteed. To access the value of the account, you essentially take a taxable withdrawal or tax-free loan you can pay back. You can use the money as needed — such as to buy a car or put a down payment on a house. Even if you never access the cash value during your lifetime, it will act as a safety net that can be used in financial emergencies. Whole life insurance can also supplement your existing retirement accounts, like your 401(k) or IRA account, helping you enjoy your golden years.

5 Things to Know While Searching for Life Insurance

  1. 1. Don’t wait
    According to the “2019 Insure Your Love Consumer Survey” by Life Happens, 69% of consumers with life insurance said that they felt less stressed knowing their loved ones were financially protected. Beyond establishing that protection right away – before it’s needed – another advantage is that typically, you can secure lower rates for life insurance when you’re younger.

Common Misconceptions

Myth:

Life insurance is only available directly through financial advisors. This is not the case. In fact, quality, strong valued policies for your entire family are often available through your workplace or your spouse’s workplace. For example, Boston Mutual Life Insurance Company offers a wide range of workplace solutions paid for by employers, employees or both, including whole life, term life, critical illness, accident and disability insurance. Licensed sales associates of Boston Mutual Life Insurance Company are always available throughout this process.

 

Glossary

Beneficiary – The person or persons named in the policy to receive the insurance proceeds at the death of the insured.

Cash value – The sum of money that can build inside many permanent life insurance policies and can be accessible. The actual cash value may be decreased by a surrender charge, loans or withdrawals.

Did You Know?

  • 78% of those who own both worksite and individual life insurance feel secure

– 2022 Insurance Barometer Study by LIMRA and Life Happens

  • More than 4 in 10 middle-income consumers say they have little to no knowledge about life insurance.

– 2022 Insurance Barometer Study by LIMRA and Life Happens

  • Over half (55%) of Americans said this past year was the first time they spoke with a loved one about life insurance.

– 2021 Life’s New Appreciations and Priorities by Life Happens

For questions, or to explore your options with Boston Mutual Life Insurance, contact a representative in your area!