Frequently Asked Questions
Do I need life insurance if I am single?
It depends, first ask yourself – “is anyone financially dependent on me?” You may not have a spouse who is dependent on you but what about other family members? Even if no one is dependent on you, you may want to consider purchasing life insurance to cover the repayment of debts, taxes, funeral and other final expenses.
But before you make a final decision, think to the future. If you get married and have children someday, you may want to have life insurance coverage. If you buy coverage today while you’re young and healthy, you’ll get much better premium rates then if you wait. Rates increase as you age and if your health deteriorates.
Should I purchase life insurance on my child?
The idea of buying life insurance for your child is something no one wants to consider because it forces us to consider the unthinkable. But purchasing a policy for a child isn’t just about having financial protection if the unthinkable happens; it’s about ensuring the child’s financial future.
Purchasing a policy also locks in the child’s insurability. Usually, children don’t have to go through a medical underwriting process – the parents simply answer a few medical questions. As long as the policy remains in force, the child will always have life insurance. Most insurance policies today also offer optional riders that will allow the child to increase their insurance coverage when they reach certain milestones in life.
Can I use my life insurance policy cash value to help with buying a home?
Yes you can. You may have access to policy cash value through either a withdrawal or as a loan from the insurance company using the policy as collateral. If you take a withdrawal, your policy values will immediately be reduced by the withdrawal amount. If you take a loan, depending upon the type of insurance you have, your policy values may continue to grow. You are not required to repay the loan, or the loan interest, during your lifetime. However, if you choose not to, any outstanding loan balance will reduce the amount of death benefit payable to your beneficiary.
What happens if I can’t make my life insurance premium payment?
If your insurance protection is Term life, you will have a grace period to make your payment. If by the end of the grace period you have not made a payment, your policy will lapse and you will no longer have coverage.
If your insurance protection is permanent life insurance, you will have a grace period to pay your premium plus some additional options. It may be possible that your policy has sufficient cash value to pay the premium from those policy values. Just be aware that using policy values and benefits to pay the premium due will reduce the policy’s cash value and death benefit, and may increase the risk of lapsing the policy. If you don’t have sufficient cash value to pay the policy premiums, you may have the option to reduce your face amount to a level that doesn’t require a premium payment.
Most importantly, if you are having trouble making your payment, contact the insurance company customer service area. They will be able to give you specific options for your policy.