Are you a primary breadwinner and worry about what might happen to your spouse or children if you were to die? Would they be able to support themselves, keep their home, and pay for all your funeral expenses? A life insurance policy guarantees that your surviving family will be taken care of after you pass away, which is why the Cordogan Agency offers several types to meet your family’s unique needs.
Whole Life Insurance
As its name implies, whole life insurance remains in effect as long as you live and delivers benefits to whomever you designate (usually a spouse and one or more dependents) upon your death. The premiums on such a policy are generally fixed and the payout is guaranteed.
However, in addition to acting as a traditional insurance policy, whole life insurance also acts as an investment account, with a portion of your monthly premiums being added to the cash value of the policy, which earns interest and grows over time according to a fixed formula. The total amount of the investment contribution plus the interest earned is known as the cash surrender value, or the value for which you can sell or borrow against the policy. Of course, if you surrender it, then you are no longer insured in the event of your death and will have to start accumulating cash value from scratch on your next policy, which may have a higher premium. Therefore, we generally recommend this policy to people who are looking for a permanent investment.
Universal Life Insurance
Universal life insurance retains the long-term investment benefits of a whole life policy, but adds some flexibility. For example, once the cash value has reached a certain level, you may be able to use a portion of it to lower your monthly premium payments or to skip an occasional payment without reducing your death payout.
Universal life policies also have the potential to earn more than whole life policies because of the way the interest is calculated. Unlike whole life, which pays a set interest rate for the entire duration of the policy, universal life sets a minimum interest rate, but may add additional interest if the investor’s portfolio earns more than the minimum amount. Because the minimum interest rate is generally lower than whole life insurance, there is more uncertainty about the final payout of the policy, and it may earn less than a whole life policy; however if the portfolio grows favorably, it can also earn significantly more.
Term Life Insurance
Term life insurance provides coverage for a certain period of time – usually 20 to 30 years – and is common when the purpose for the insurance is to protect children or other dependents for a limited amount of time. Term life has significantly lower monthly premiums, which makes it more affordable; however there is no investment component and no cash value.
Like whole life insurance, the premiums generally remain constant throughout the term and the insurance offers a guaranteed payout in the event that the policyholder dies.
Call The Cordogan Agency To Speak To An Agent
Your family is your most precious asset – make sure they’re covered! Whether you’re looking for the permanent protection of a whole or universal life insurance policy or need temporary and affordable coverage, we can help you find a policy that’s right for your family’s needs. Call agent Michael Cordogan today to get started at (901) 507-2198.