Thinking about life insurance can feel overwhelming. But, it is an incredibly important decision to make. Picking the life insurance plan that is right for you will majorly benefit your loved ones in the future. But, it can be hard to decide, especially if you do not have all of the necessary information. If you are struggling to make a choice about life insurance, it can help to read up on the topic. Additionally, you may want to reach out to an estate planning attorney. An attorney will help you determine the best choice and help you create an estate plan that suits your needs. Read on for more information regarding life insurance and estate planning.
What is Life Insurance?
Life insurance policies are contracts with insurance companies. When you purchase a life insurance policy, the insurance company will provide your beneficiaries with a lump-sum payment in the event of your death.
What Are the Different Types of Life Insurance?
Everyone has a different lifestyle and financial situation. As a result, it is important to find the plan that best fits your needs. Generally, there are three main types of life insurance. The three types are as follows:
- Universal life insurance: Universal life insurance provides the insured individual with lifetime coverage. That being said, generally, universal life insurance policies are rather flexible, meaning in many cases, you can actually raise or lower your premium payment or coverage amounts at various points in your life. That being said, these generally come with higher premium payments than other types of insurance.
- Term life insurance: Many people who lose potential income during working years will turn to term life insurance for relief. This type of insurance can replace lost income, however, the benefits are paid in one lump-sum, as opposed to regular payments.
- Whole life insurance: Whole life insurance is permanent life insurance, and it is designed to provide lifetime coverage. That being said, the premiums are generally higher than term life insurance, and are typically fixed payments with a cash value. The cash value works as a savings component, and may accumulate tax-deferred over time. Whole life insurance can help preserve the wealth you plan on transferring to your beneficiaries upon your passing, making it a useful estate planning tool.
If you are struggling to determine which life insurance plan is best for you, reach out to an experienced estate planning attorney. Our firm will help you choose the plan that best suits the needs of you and your loved ones.
Contact our Firm
Sometimes, divorce, family, and estate matters are difficult to navigate. Fortunately, they do not have to be with the assistance of a compassionate, knowledgeable attorney who is willing to guide you every step of the way. If you need a seasoned firm to help you with any divorce, family or estate-related matter, please do not hesitate to contact Collis, Griffor & Hendra today to schedule a consultation.