Characteristics of Variable Life Insurance Products Although variable life insurance products pay out a death penalty when the policy holder dies, it can actually be looked at as more of an investment vehicle for your cash. Part of the premiums you pay for your insurance can be reallocated to other accounts that allow you to earn returns that add to the value of your life insurance. For example, you can invest part of your premium...more
Corporate-Owned Life Insurance The death of a key employee in a business represents a terrible loss to the corporate family. It can also cause considerable financial loss particularly if the person was a significant owner in the business or was in a position that requires considerable time, effort, and expense to recruit a replacement for. Although it may seem callous to some, taking out a corporate owned life insurance policy on...more
Life Insurance Tax Treatment No matter what you do, you can't get away from having to pay taxes. This even includes the payout from a life insurance policy. There are a few different ways that the proceeds from a life insurance policy are paid out and each has an accompanying tax situation that must be handled. The policy itself has tax benefits and consequences. Although the premiums paid to a life insurance policy are paid with after tax funds, the premiums cannot be claimed on your taxes. However, interest earned on the cash benefit of a particular insurance is tax deferred until the death benefit is paid out or the money in the policy is otherwise withdrawn.Generally, money from the policy that paid to the beneficiary because the policyholder died is not subject to federal taxes. However, the cash given may be subject to estate taxes as part of the estate you are leaving behind to your heirs. So even though the amount of money left to your heirs may be well under the allowed non-taxable amount, if the amount of the policy pushes it over them limit then your heirs will have to pay estate taxes on everything. For example, if your estate is $500,000 but the...more
Evaluating Life Insurance Needs People tend to put off buying life insurance. The main reason may be that they do not want to think about their death. More often than not, though, it is also that they do not know how to evaluate their life insurance needs so that they have enough coverage. There are many things to take into...more
Term Life Insurance - The Pros and Cons A life insurance policy means that an individual has an immediately established estate to leave to their beneficiaries once they pass away. It is of particular importance for the person in a household that is the primary income earner to consider life insurance in order to continue to provide...more
Types of Life Insurance - Are They All The Same? Life insurance is a tool that many people use to provide a healthier or more robust estate for their beneficiaries. There are a number of different types of life policies available but they all work in basically the same way. An individual chooses how much money they want to leave behind to their family or loved ones and then pays monthly premiums on a policy until they pass away. At the time of the policyholder's death, the insurance company pays the beneficiaries the amount of death benefits due to them. The vast majority of life insurance works just like this, but there are a few notable exceptions.Single premium life policies do not require an individual to make a monthly premium payment. These types of policies are paid in full at the outset. An individual can choose to pay just about any amount to open this type of life insurance policy with the caveat being that most insurance companies require a minimum payment of at least $5000. Just because a person has life coverage does not mean that their beneficiaries are guaranteed to get death benefits if that person passes away. In the case of a term life insurance...more
Death Benefit Proceeds of Life Insurance - Distribution and Taxation! The taxable nature of death benefit proceeds from life insurance is something that most people do not have a clear understanding of. Most people believe that the...more
Choosing the Right Life Insurance - Making the Best Decision Choosing the right type of insurance policy to meet your needs requires you to have a clear purpose in mind for the policy. If you are interested in simply covering whatever...more
Investment Through Life Insurance - The Basics A life insurance policy can go well beyond simply providing for the beneficiaries of the policyholder after their passing. The right type of policy can actually act as a vehicle for...more
Is Term Life Insurance a Good Investment? - The Facts Trying to decide what type of life insurance is best going to suit your needs can be a daunting and confusing task. There are a myriad of options available and you must consider not...more
Life Insurance - Extra Cash When Times Are Tough A permanent life insurance policy that a person has been paying into for a number of years can provide them with a means to get emergency cash without having to deal with a bank. Not all...more
Pet Care Insurance- Planning Ahead Not many people understand the massive responsibility that is included with owning a pet. Upfront expenses, depending on the age of the pet, will consist of veterinarian visits for preventative shots,...more