Life Insurance Guide
Help Secure Your Family's Financial Future: Understanding Life Insurance
Life Insurance Testimonials
I've been with Bob and his family team since retirement in 2008.
Since then his team has me set for Life Insurance and Long Term Care.
I couldn't be more pleased with the care and support his family and team provide.
Langan Financial Group always has your best interest in mind. We talked to them about our needs and what we were looking for.
They provided several options to help us find an affordable life insurance product to protect our family, financially.
We're glad we went with Langan Financial!
What is a Life Insurance Policy?
Life insurance is a financial tool available to help you protect your family and loved ones after pass away.
It will help provide financial support for:
- Debt
- Other expenses
- Funeral expenses
It can help provide financial security and stability during a very difficult time for individuals.
How Does Life Insurance Work?
It is a contract between two parties.
The policy owner agrees to pay premiums for a set period of time or amount in exchange the insurance company will pay a sum of money known as the "death benefit" to named beneficiaries when the insured dies.
Is Life Insurance Taxable?
Life insurance premiums are typically not tax deductible for an individual, while the death benefit proceeds are not taxable.
The IRS states, the insurance proceeds are typically not to be included in gross income and do not have to be reported.
However, there are some situations in which it is taxable including:
- Any interest you receive is taxable and should be reported as such
- If the policy was transferred to you for cash or other valuable consideration
What Are the Benefits of Life Insurance?
The benefits of life insurance are the death benefit in most cases is not taxable and may be used by the beneficiaries for numerous things including but not limited to:
- Funeral costs
- Healthcare costs
- Debt including mortgage
In other circumstances, life insurance can have a cash build-up through investing in the premiums.
This portion accrues tax deferred and allows the policyholder to draw funds from it.
Do I Need Life Insurance?
You may be surprised when we say, no not everyone needs life insurance. A quick way to determine if it is worth considering is to ask yourself:
"Would my death, right now, negatively financially impact the people within my life?"
If the answer is yes to that question, then it may be worth having a more in-depth conversation to discuss your current needs and review life insurance policies.
What is the Goal of Life Insurance?
The goal of is to avoid adding debt or financial stress to your family's or your business partners' lives.
If people would inherit debt, lose their income, or increase bills then the insurance may be worth considering.
Can Life Insurance Help Me?
Life insurance can help provide financial support to individuals for:
- Pay off debt gdfg
- Replace lost wages
- Pay for funeral expenses
- Provide a college education
Life Events Worth Considering Insurance for:
The types of events that usually cause people to look into life insurance policies include:
- Buying a home
- Having children
- Getting married
These events typically encourage people to look into life insurance policies because either:
- You now have dependents relying on you
- You have a mortgage or debt that you do not want to pass off to other family members
Types of Life Insurance
1. What is Term Life Insurance
The length of time for term insurance premiums varies greatly. There are policies you can pay for anywhere from one year up to 30 years.
Term life insurance policies do not have any other value besides the guaranteed death benefit. Under term insurance, the insured has the choice to:
- Renew the terms if it expires
- Allow the policy to terminate
- Convert the policy to permanent coverage
2. What is Whole Life Insurance
Whole life insurance is typically more expensive than term insurance for the same coverage, but it has an additional benefit.
Besides providing a permanent death benefit for the insurers' entire life, it also has a cash accumulation value.
Cash value occurs within the whole life policy as the premiums are split into three payments:
- Cash value
- insurer's costs
- Death benefit
The main difference between term insurance and whole life can be thought of as renting vs. owning.
In one policy, you are simply renting the death benefit. It provides a minimum benefit, depending on the situation, and may be exactly what you need.
Whole life insurance is similar to owning a property. As you continue to pay the premium, equity is built up in the form of cash.
Each policy helps provide a benefit and depending on what your situation is, one may be more beneficial than the other.
3. What is Universal Life Insurance
Universal Life Insurance is a type of permanent insurance in which the insured person is covered for their lifetime as long as the policy's requirements are met.
Similar to Whole Life, Universal has a cash value portion of the policy. The main difference is Universal's ability to be flexible.
For Universal Insurance, you can choose a premium and death benefit level or adjust your plan according to specific requirements within your policy.
4. What is Variable Life Insurance
Variable Life Insurance is another type of permanent insurance policy that also provides a cash value portion to the policy.
The main difference is variable insurance allows for the accumulated cash value to be invested in funds in a separate account.
In addition, the death benefits and premiums are more flexible, similar to a Universal Life's policy.
5. What is Group Life Insurance
Group Life Insurance is a policy that provides coverage to an entire group or population. These types of policies are very common among employers or other large-scale organizations.
Through aggregating costs, group insurance can be fairly inexpensive and in some situations free for members to employee participants.
However, if you leave the organization you may lose your coverage.
How Much Does Life Insurance Cost?
7 Key Factors That Determine Life Insurance Rates
- Age
- Health
- Gender
- Type of policy
- Life expectancy
- Any Riders added on
- The coverage amount
These factors can cause insurance to vary widely and in some capacities cause the individual to be uninsured entirely.
Under health, this includes not only height and weight but also medical history, family medical history, smoking and tobacco use, drug use, lifestyle factors, etc.
You can imagine as these factors compound, for some individuals it may be very costly or impossible to receive insurance, while for others it may be more than affordable.
It really is hard to predict for people without having a conversation to inquire more.
Choosing a Life Insurance Agent
Working with a local Life Insurance Agent is an important decision that can impact not only your future but your family.
When deciding what insurance agent to work with, be sure the company is an independent agency that does not require its advisors to meet specific quotas meet or sell certain products.
You want an advisor that can understand your needs and find a product that meets your requirements rather than having to push products to meet quotas.
When it comes to insurance, there is no one product that fits all. Each person's case should be discussed to understand:
- What are your goals
- What is your situation
- What are your obstacles
- What plan aligns best to overcome your obstacles and achieve your goals
Schedule a Chat with Life Insurance Agent
Langan Financial Group's life insurance agents have over 100 years of experience servicing insurance policies for individuals and families.
Give us a call at 717-288-1880 to see how our local advisors can help with your insurance policy needs.
Or visit our life insurance agent contact page to fill out an inquiry.
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Financial Advisor Locations:
Camp Hill, PA Financial Planning Office
York, Pa Financial Planning Office
Harrisburg, PA Financial Planners
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Disclosure: Check the background of your financial professional on FINRA's BrokerCheck. The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Cambridge and Langan Financial Group, LLC. are not affiliated. Cambridge Investment Research Advisors, Inc. a Registered Investment Advisor. Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a broker-dealer, member FINRA/SIPC, to residents of: AL, AZ, CO, DE, FL, GA, IA, KY, MD, NJ, NM, NY, NC, OH, PA, TX, VA, WI Cambridge and Langan Financial Group does not offer legal advice. Estate planning services are in regards to your overall financial plan. Always be sure to speak to a legal professional in regards to specific legal matters. Fixed insurance services offered through Langan Financial Group.
Testimonial/Endorsement Disclosure: The testimonials may not be representative of the experience of other customers. The testimonials are no guarantee of future performance or success. All of the testimonials/endorsements are clients with the exception of Steven Martinez of York SPCA. There was no cash nor non-cash compensation for any of the testimonials provided.
© Langan Financial Group
Harrisburg, PA Office
Address: 1863 Center St, Camp Hill, Pa 17011
Phone: 717-288-1880
York, PA Office
Address: 3405 Board Rd, Suite 200, York, Pa 17406
Phone: 717-773-4085
