I also discovered that this prospect was not in good health. He had several health issues to contend with. To further complicate the issue, this prospect was a tobacco user and was over weight. In view of this additional information, if he was even able to purchase this policy, the premium would have exceeded $400.00 per month. Did his father act in the best interest of his son? You bet he did.

Please keep in mind that we never purchase Life Insurance protection on our children or grandchildren to profit by their demise. Rather, we purchase Life Insurance protection on our children and grandchildren to take advantage of the affordable rates and to guarantee their future insurability. Let’s face it, we never know what misfortunes our children will encounter as they grow older.

Much of our Agency’s activity focuses on the Children’s Insurance market. One very popular product with Parents and Grandparents features a Death Benefit of $20,000 at an $11.00 per month premium. That premium is guaranteed for 20 years and may never increase. What makes this product attractive is the fact that while the premium remains stable, the Death Benefit increases as the child grows older. The Policy Owner may elect to increase the premium. The result is that the Cash Value will accumulate at a faster rate. The Policy Owner may also elect to increase the Death Benefit subject to underwriting guidelines.

My three year old granddaughter has one of these plans. If no changes are made, by the time she reaches retirement age, the Death Benefit will have increased to over $30,000. For additional information on this or other products, please contact our office.

As the Life Insurance industry evolved, many variations to Term and Cash Value Life Insurance products have been introduced. The most common Cash Value Plans we see today are Whole Life, Universal Life and Variable Life. Term Insurance has basically remained unchanged except for the fact that it has become less expensive in recent years due to increased competition and the fact that people are living longer. The most innovative improvement that I have seen recently to Term Insurance is the introduction of the Return of Premium Option. This option causes Term Products to act similarly to Cash Value plans.

At the end of a 20 or 30 year period the client may have an option to continue the policy at a higher monthly rate, receive a reimbursement of all premiums made into the policy less any funds previously paid or he may accept a reduced paid up life insurance policy. These policies are usually less expensive than Cash Value policies. In my experience, these plans are excellent for young insureds perhaps in their 20’s or 30’s. They also fit nicely into Key Man Plans for businesses.

Historically, Term Insurance Plans do not pay the vast majority of death claims. As people age, the Term Insurance Plans that were purchased at an earlier age, become very expensive to keep in place. As a result, these plans are replaced with Cash Value plans that are just large enough to cover Final Expenses.

So, is Term Insurance or Cash Value Insurance best for you? Before I can make that determination, I look at each of my clients on a case by case basis. As a general rule for young insureds I recommend looking at purchasing both plans while they are young and healthy. The Term Insurance is very affordable and will provide protection while raising a family and paying off a mortgage. One option for purchasing a Cash Value Life Insurance plan is a 10 pay life. This simply means that the policy will be paid for after a 10 year period. It can then be set aside for Final Expenses after the need for Term Insurance has past. I can not stress enough that life insurance should be purchased while we are young and healthy. Life Insurance is not purchased for us, it is purchased for those that we leave behind.