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Personalized Life Insurance Plans in Northeast Dallas
Get insured and prepare for difficult times. Reach out to our insurance agents in Northeast Dallas to buy a suitable life insurance policy.
Term Life
Term life policies last from five to thirty years and are a good option for those who need affordable coverage or to help with short-term needs. With term life, you also can change it into a permanent policy in the future.
Term Life Plans
Term life insurance is a type of life insurance that lasts for a specified term, usually between five and thirty years, and provides a death benefit if the policyholder dies within the given term of the policy. The death benefit will be provided to the policyholder’s chosen beneficiaries. If the term expires before the policyholder passes, then the policy can be renewed for another term, be converted into permanent coverage, or terminated.
Types Of Term Life
There are three types of term life insurance:
- Level Term: Level term policies, also known as level-premium, provide coverage anywhere from ten to thirty years, with a fixed premium and death benefit. However, the premium for this policy is more expensive than the yearly renewable term policy.
- Yearly Renewable Term: There is no specified term for this particular policy, but it can be renewed each year as it is a one-year term policy. The premiums are not fixed; as the policyholder ages, the premium increases.
- Decreasing Term: These policies have a fixed premium, but the death benefit decreases each year. These policies are typically used with a mortgage to match the coverage of the home loan and its declining principal.
Who Should Get Term Life?
Although term life does not build cash value or offer a larger death benefit compared to whole or universal life policies, it is a great option for someone who is looking for coverage at a lower cost.
If you:
- Are young and healthy
- Need simple and low-cost life insurance to protect your beneficiaries
- Do not require long-term life insurance and only need temporary insurance
- Want to supplement your existing life insurance
Then you should also consider a term life policy.
Whole Life
Whole life insurance is a permanent policy that offers two primary benefits: a guaranteed death benefit and a cash value. Because a whole life policy lasts for your whole life, it is typically best for those who want to accumulate a cash value over several years while still having a death benefit available to their beneficiaries if the worst was to happen.
Whole Life Insurance
Life insurance provides the plan holders’ beneficiaries with a lump-sum death benefit payment once they pass away. Whole life insurance provides you with permanent coverage that lasts for the entirety of your lifetime, while term-life insurance only lasts for a set period of time. In order to maintain a whole life policy, you will need to pay monthly premiums for as long as you are alive.
What Is Whole Life Insurance
Whole life insurance policies are long-term contracts that guarantee a death benefit upon the policyholder’s death. They also have a cash-savings component that can be drawn from if needed. As you make premium payments, your insurance policy will grow in value, making it a source of equity that grows over time.
Cash Value Of Whole Life Policies
Whole life insurance policies eventually grow cash value, which can be used to take out loans. If you do decide to take a loan from your policy’s equity, you will have to pay it back before you die. Otherwise, the remainder of the loan will be deducted from your death benefit before it is paid out to your beneficiaries. Fortunately, withdrawals of funds that are within the total value of premiums paid are tax-free.
Death Benefits
When you die, the payment your family receives is called a death benefit. The death benefit does not need to be included in the beneficiaries gross income, but you can choose to have the payments dispersed over time instead of as a lump sum. This payout is set at the time you sign your contract, although some insurers may allow you to make adjustments as you grow older. The death benefit can also be increased by reinvesting dividend payments into additional death benefits over time. Some people also choose to add riders to their policy, allowing them to access supplemental benefits like accidental death benefits. There are also riders that protect the death benefit from expiring if the insured becomes disabled or terminally ill.
Who Should Get Term Life?
Although term life does not build cash value or offer a larger death benefit compared to whole or universal life policies, it is a great option for someone who is looking for coverage at a lower cost.
If you:
- Are young and healthy
- Need simple and low-cost life insurance to protect your beneficiaries
- Do not require long-term life insurance and only need temporary insurance
- Want to supplement your existing life insurance
Then you should also consider a term life policy.
Universal Life
Like whole life insurance, universal life is a permanent policy that lasts your lifetime and builds cash value. This policy is different from the other policies, though, as it also provides the flexibility to raise or lower the premium payments. Overall, it is more costly than a term life policy, but typically cheaper than a whole life policy.
Final Expense
Final expense, also referred to as burial insurance, is a type of permanent life insurance policy that covers funeral expenses. The death benefit, which is provided to the policyholder’s beneficiaries, can be used for said funeral expenses, as well as medical bills and other end-of-life costs. A final expense policy can provide a death benefit of up to $50,000.
A final expense policy will last your entire lifetime as long as you continue to pay your premiums. To qualify for a final expense policy, you do not have to undergo a medical exam, but you may be required to answer a few health questions.
Types Of Final Expense
There are two types of final expense:
- Guaranteed Issue: This type is often referred to as “no questions final expense insurance.” It does not require you to undergo a medical exam, answer health questions, or present your medical and prescription history to the insurance company. However, because you are guaranteed to get this policy, there are some catches. It has a waiting period of two to three years. If you die during this waiting period, your beneficiaries will not be paid a death benefit; however, the insurance company will repay them your insurance premiums along with interest. Guaranteed issue policies are often meant for those with severe health conditions who cannot qualify for other insurance.
- Simplified Issue: This policy also does not require a medical exam, but it does require you to answer a medical questionnaire. If you are approved, you can secure coverage up to $50,000. However, because of the questionnaire, insurers can set a premium based on a modified risk assessment. This policy is typically meant for those who are considered moderate risk, but do not qualify for other policies.
What Is Final Expense Insurance
Final expense insurance is a form of life insurance that has a small death benefit and lower overall costs. It is also easier to qualify for final expense insurance, making it a great option for people who need coverage immediately. This is what you need to know about final expense insurance policies.
Final Expense
Final expense insurance is also known as burial insurance and it can help your loved ones pay for death related expenses, such as burials and cremations. The death benefits are small, but this also means you don’t have to pay as much in premium payments. This means final expense insurance can prove to be a useful supplement for a term or whole life insurance policy.
Final Expense Death Benefits
With final expense policies, the death benefit will likely be $20,000 or less. Some plans offer death benefits as high as $50,000, but they are rare. This is because insurance companies expect the average burial or cremation to cost anywhere from $5,000 to $15,000. With this in mind, it is also important to note that final expense payouts do not have to be spent on burial or cremation costs. In fact, the beneficiaries are free to do whatever they like with the money.
Why Get Final Expense Insurance
As mentioned previously, final expense insurance can prove to be a helpful supplement to your current insurance plan. Some people don’t even have life insurance, instead relying on their own savings to keep their loved ones secure after they pass. If this is the case for you, final expense may be a good idea, as it will help your family take care of any costs related to your death, such as medical bills or funeral expenses.
Average Funeral Costs
End-of-life costs often include medical bills and funeral expenses. Depending on what type of funeral you would like, the cost of the events can range into the tens of thousands. Life insurance policies and final expense insurance can help lower these costs, leaving your family with more money to replace your income. When choosing your life insurance plan, it helps to know how much your burial will cost.
Traditional Burial Average Costs
A traditional burial typically involves services like embalming and other preservation processes. You may also have a viewing if you so desire. Other things that may increase the cost are your choice of casket and other burial related products, such as burial vaults and grave liners. While the average funeral costs between $5,000 and $15,000, additional services and products can easily drive the price up by several thousand dollars
Cremation Average Costs
Cremations are often cheaper than traditional burials, as there is less work required and you won’t need to purchase a casket. Ceremonial services, like viewing and visitation may increase costs, but direct cremations where none of these services occur are also an option. If you want the cheapest possible cremation, whole body donations include cremation for free, making them the most affordable end-of-life option available.
Is Final Expense Worth It
Final expense insurance is a light form of life insurance that offers smaller death benefits than whole, term, and universal life insurance plans. Whether or not final expense insurance makes sense for you depends on a number of factors. Here is what you need to think about before buying final expense insurance.
Do You Need Final Expense Coverage?
If you are wondering whether or not to invest in final expense insurance, consider your end-of-life expenses and how they will be covered. Many people have life insurance policies set up to pay their families a death benefit that can be used to cover any expenses associated with their death. If you don’t have life insurance currently, final expense is an affordable option you can use to ensure that your burial doesn’t negatively impact your family’s finances.
Even if you do have life insurance, final expense can be a good supplement to your current policy. If you allocate the death benefit of a final expense plan to your burial expenses and use the life insurance plan to replace your income after you pass, the arrangement should allow your family the most flexibility after your death. To determine if a final expense policy makes sense for you, work with an insurance professional.
Benefits Of Final Expense Insurance
Final expense insurance has smaller death benefits than traditional life policies, but they typically provide enough of a payout to afford the average funeral. Final expense insurance is also easier to qualify for, making it a great option for people who were unable to qualify for other insurance options due to their current health condition. Keep in mind that the death benefit can be used to pay for anything, not just your funeral, therefore final expense insurance can go a long way to keep your family financially secure.