Welcome to Quotacy’s Q&A Friday where we answer your life insurance questions. Quotacy is an online life insurance broker where you can get life insurance on your terms. I’m Jeanna and I’m Natasha. November is National Gratitude Month which makes sense with Thanksgiving this month as well. So what are you most grateful for? Your family? Friends? Your health? Take a look around at the life you’ve created for yourself. How do you protect it? And, more importantly, how are you protecting the people in it? Life insurance can ensure that your family can maintain their current standard of living even if you died unexpectedly and your paychecks stopped. A life insurance policy has an insured, a policy owner, and beneficiaries. The policy owner has control over the policy and is responsible for paying the premiums. This person can be the insured or it can be two different people. Upon the death of the insured, the beneficiaries receive death benefit proceeds from the insurance company. A life insurance policy can provide temporary or permanent coverage. A term life insurance policy covers the life of a person for a specific number of years. If the person dies during this period, the death benefit is paid. If the person is still alive at the end of the period, the policy simply terminates. Because term life insurance is temporary, it is the most affordable type of life insurance. Sometimes people initially think this design is a waste of money since your beneficiaries only receive the payout if you die during the term. But think of it like your car or homeowners insurance. You pay the premiums every month hoping nothing happens but you have a safety net just in case. You hope to live a long healthy life, but term life insurance coverage protects against those what ifs of an unexpected death. The death benefit replaces the income you once provided to help your family pay bills and maintain a certain standard of living. When buying term life insurance you choose how long you want coverage for. Depending on your age, the term length options vary from 5 to 40 years. The term length that’s right for you is dependent on your unique situation. Same with how much coverage you should buy. Everyone’s life insurance needs are different. A general tip for buying a term life insurance policy is to buy a policy with a face amount that covers your largest amount of debt, which is typically a mortgage, and then choose the longest term length you can comfortably afford. Quotacy has an easy-to-use life insurance needs calculator you can play with to get a good estimate of how much life insurance coverage you may need. We’ll put a link to it in our description below. Let’s look at an example to get a good grasp on term life insurance. Tony Salzano is a 40 year old husband and father of two young children with a third on the way. Because his youngest child hasn’t even been born yet he applies for the longest term length possible which is 40 years. Tony has high blood pressure but otherwise he’s healthy. He’s approved at Preferred, which is just one risk class shy of the best. Tony’s premiums for a $500,000 40-year term life insurance policy at Preferred rates is $137 per month. This policy insures Tony until he’s 80 years old. If he dies within the 40 years, his family receives a check for $500,000. If he is alive at the end of the 40 years, hooray! So, term life insurance is temporary but there are also permanent types of life insurance. You’ve probably heard of whole life insurance. It’s the most well-known type of permanent life insurance. Universal life insurance is another commonly purchased type of life insurance. While term life insurance is the best option for most families, permanent life insurance is a good product for some situations. With a whole life insurance policy, as long as you keep the policy active your life insurance coverage will last your entire life. Like term life insurance, whole life insurance has fixed premiums meaning they won’t increase your entire life. But these premiums are much higher than term life insurance premiums because the death benefit is guaranteed and the policy accumulates a cash value. Universal life insurance trades some of the cash value growth benefits for a more flexible payment plan and a lower price. Consider a permanent life insurance policy if you wish to build tax-free wealth, equalize an inheritance without selling a family farm or business, leave a guaranteed inheritance to your loved ones, or provide long term care for someone with special needs or a disability. If you have a large estate, a whole life insurance or universal life insurance policy may be a good product for your financial portfolio because it generates a cash value and can provide tax advantages. For families that are more budget conscious, but still have permanent life insurance needs, a guaranteed universal life insurance policy might be the right choice. A guaranteed universal life insurance policy is a type of permanent life insurance that focuses more on the death benefit versus a cash value accumulation. As long as you pay your planned premiums to keep your policy active your beneficiaries will receive the guaranteed death benefit when you die. For some families, a combination of term and permanent life insurance may be ideal. Let’s go back to Tony and his family for an example of when owning both types is beneficial. Tony is a 40 year old husband and father of three young children, one of which has Down syndrome. He and his wife recently purchased a home. The 30-year mortgage has a balance of $250,000. His daughter with Down syndrome may become semi-independent but likely will need financial and medical assistance her entire life. To ensure she can always get the proper care and maintain a healthy, happy standard of living, Tony wants to make sure he has some permanent life insurance on himself and his wife. He buys a 30-year, $500,000 term life insurance policy to cover the mortgage and raising the children. This policy costs him $60 per month at his Preferred risk class and will be active until Tony turns 70. He also purchases a $100,000 guaranteed universal life insurance policy for $70 per month. This is guaranteed to pay out no matter when Tony dies. If Tony unexpectedly dies at any time within the 30 year term both policies will pay out. You never know what tomorrow will bring. And while medical technology is advancing every day, you’re not invincible. Now is the time to buy life insurance to protect those you’re most grateful for. And Quotacy can help. Thanks for watching. If you have any questions about life insurance, make sure to leave us a comment. And if you have any questions regarding today’s topic, check out the blog link posted below. And if you’re ready to get quotes, check out Quotacy.com. We’re here to help you find the best deal on life insurance you want. Bye! Thanks for sticking around. We’d appreciate it if you Liked the video and hit that fancy little Subscribe button to see us every week. Bye!