Life Insurance Blog by IntelliQuote

As a single parent you do everything you can to protect your children. From teaching them good nutrition to helping them with their homework, you’re preparing them for the future. But what about preparing for the unexpected? Have you taken steps to protect your children if you’re no longer able? Having life insurance in place, to provide for your children, is one of the most important things you can do.

As a single parent your children’s welfare rests solely in your hands. Though it’s difficult to consider the circumstance your children will face if you pass away or become disabled, it’s your responsibility to advocate for your little ones. By purchasing life insurance, you can rest assured that your children will be provided for in the case of a tragedy.

Term Life Insurance

Studies have shown that most Americans grossly overestimate the cost of life insurance protection. In fact, a 2012 survey from leading life insurance industry authority LIMRA, revealed that the average consumer believes that life insurance protection costs nearly three times the actual price. If you are not currently carrying life insurance because you fear you cannot afford protection, we encourage you to take a look at term life insurance.

As we recently discussed in our piece on the disappearing 30 year term, it’s becoming more and more difficult to lock in 30 year term life insurance rates. Historically low interest rates are taking a toll on the life insurance industry. In response, Carriers are looking to reduce risk and, as a result, one of the first products to hit the chopping block is the 30 year term.

The 30 Year Term

When we consider the implications of a down economy many things come to mind: a decline in the real estate market and rising unemployment rates. But what about a decline in insurance products? Though this might not be the first thing you think of, it does in fact have the potential to impact us all. Insurance companies depend upon investments for their success. Profits are invested in the bond market, giving carriers the flexibility to take on more risk and issue more policies. When the market is down, insurance companies must assess risk more carefully. Because longer term policies are inherently higher risk products, they are the first to be removed from a Carrier’s portfolio.

So you’re comparing life insurance rates but you’re not sure if you’re getting a good deal? The best way to understand if you’re in fact getting a competitive rate is to familiarize yourself with the anatomy of a term life insurance rate. There are several factors that come into play and ultimately determine your out-of-pocket cost. Let’s take a closer look at each:

Health/Age

Your health and age play a major role in the life insurance rates available to you. The younger and healthier you are when you lock in coverage, the better deal you will get. Health risk factors that will come into play include: tobacco use, height /weight ratio, medical history, family medical history, blood pressure, cholesterol level and drug and alcohol use.

Medical Exam

There are term life insurance policies available that don’t require medical exams; they do however tend to be more expensive. If you choose to undergo a medical exam, the results of your physical will have a direct impact on your life insurance rates. The exam will include: a series of medical questions, a blood pressure reading, a urine specimen, a blood sample and in some cases an EKG.

If you’re currently shopping for coverage and you’re not sure how to determine if you’re in fact getting the best life insurance for your needs, we’re here to help. At IntelliQuote, we’re dedicated to helping consumers find the very best life insurance based upon their individual situations. Today’s post is the second in our blog series designed to help you get the right coverage at the right time.

Work with a Dedicated Agent

As a leading online insurance agency, we are proud to employ the best life insurance agents in the industry. We proudly offer all of the conveniences of an online agency with the one-on-one customer support of a traditional, brick and mortar agency. Each and every customer who contacts us via phone or online, is assigned a dedicated IntelliQuote agent. The agent is then available to you through every step of the shopping and application process, ensuring that each of our customers secures the best life insurance for their individual needs. Even in the case that the consumer chooses to wait to purchase coverage, the agent will be there to help resume the process right where they left off. Once coverage is in place, our dedicated agents remain available to answer questions, review policy details and more.

Many consumers are under the misguided assumption that life insurance strategies are solely for the wealthy. We’re here to tell you that this could not be further from the truth. At IntelliQuote we’re always excited to share tips and tricks to help you get the most out of your life insurance protection; today’s topic is no exception. If you’re one of the millions of Americans nearing retirement with a less-than-adequate pension, we’ve got some good news! The right life insurance policy might be exactly what you need to close the gap.

Protect Your Survivors

Many Americans who once planned to leave their survivors with a healthy inheritance are now forced to draw upon some of that hard earned savings. An example of this would be a retired couple who is forced to take a reverse mortgage when their pension and investment income is no longer keeping them afloat. Rather than completely depleting their children’s inheritance, the couple can purchase a life insurance policy. Policy benefits can one day be used to preserve the value of the couple’s home, enabling them to leave their children with an inheritance after all.

Final expense life insurance is designed to help your loved ones in a difficult time. Burial, funeral and other final expenses can be exorbitant. Final expense life insurance spares your loved ones of financial burden, allowing them to celebrate your life and the legacy you will one day leave behind.

The Advantages of Final Expense Life Insurance

Final expense life insurance is a highly affordable form of whole life coverage. Intended to cover expenses upon the insured’s death, policy benefits are issued with immediacy. Because final expense life insurance policies have a low face value, generally between $5,000 and $10,000, they are offered at a nominal cost. In most cases, policies are available for issue to those ages 75-90. Final expense policies are often underwritten without the need to submit to a medical exam, making it fast and easy to secure coverage.

As leaders in the life insurance industry we have helped thousands of consumers, like yourself, answer the age old question, “term life vs. whole life; which to choose?”

Before we can you truly help you determine which is right for you, we first have to explain the benefits of each:

The disappearing 30 year life insurance term is a topic we’ve discussed in recent posts. Because it promises to have wide-spread effects on our industry, we feel that it’s important to once again address the topic and remind you that now is the time to compare 30 year term life insurance rates! 

The 30 Year Term and Current Interest Rates

From refinancing to debt consolidation opportunities, we have certainly been hearing a lot about the benefits of low interest rates. There are however plenty of downsides to these historically low rates. The insurance industry is taking a particularly hard hit at the moment. How so?

The success of an insurance company is tied directly to the bond market. For a carrier to remain solvent, they must be well invested. As interest rates fall, profits follow suit; leaving insurance companies forced to reduce risk. In order to do so, many carriers are reducing and even eliminating 30 year term products. Genworth and AXA Equitable completely stopped offering 30 year term policies last year. Other insurance giants are expected to take similar measures in the coming months. In fact, a recent survey completed by Towers Watson found that most insurance CFOs have implemented a multitude of new product strategies in the past year. These strategies including: exiting product markets (25%), adjusting premiums rates (56%), reducing living benefits guarantees (56%) and significantly curtailing product sales (54%).*

With tax day just around the corner we figured now was a very appropriate time to tackle the topic of life insurance proceeds and taxes. If you’re currently in the market for life insurance coverage it’s very important to consider the tax implications of your life insurance benefits. How much will your family be taxed at the time of your death? Could you face taxes if you choose to draw upon the cash value of your policy during your lifetime? These are great questions and we’re here to help you get to the bottom of them.

Are life insurance proceeds taxable?

In most cases life insurance proceeds are excluded from income tax for beneficiaries but they can be taxed as part of the deceased’s estate. Naming a beneficiary is the best way to avoid estate/inheritance taxes.

How much will your family be taxed at the time of your death?

The first step in protecting your life insurance benefits from taxes is naming a beneficiary. In doing so you will ensure that your proceeds pass quickly and directly to your loved one(s), outside of your estate, at the time of your death. Failure to do so often means that proceeds are classified as part of the deceased’s estate and are therefore subject to estate/inheritance taxes.

For many Americans tax season is a stressful time of year. It’s during this time that we review our finances, consider our recent financial decisions and cross our fingers for that sweet word … “refund!”

As you sit down this year and finalize your 2012 tax returns, we encourage you to take this opportunity to look to the future. What better time than right now to consider your financial situation and plan for tomorrow? At IntelliQuote we like to remind consumers that tax season isn’t just a time to crunch numbers and itemize deductions; it’s an opportunity to get on the right financial path for the year to come. If you feel like there might be some room for improvement with your financial plan, we encourage you to consider the following:

Retirement Planning

Regardless of your age, or tax bracket, you should have a retirement plan in place. Whether you’re just now entering the workforce, or you’re well into your career, a retirement plan is essential to your long term financial success. Sit down with a financial advisor and review your current situation, including: income to debt ratio, monthly expenditures, and investments. Are you contributing enough to your retirement plan? Can you afford to contribute more? At your current pace, how long will it take for you to be ready for retirement? By taking the time to calculate and consider each, you’ll have a firm grasp on the health of your retirement strategy. If you find that your plan is coming up short, there’s no time like the present to get on the right track!