Term Insurance or Permanent Insurance?

Watch out for these term insurance risks .

Do you want permanent life insurance coverage for your family or business, regardless of how long you live? Then a permanent insurance policy is right for you.

There are important differences between term life insurance and permanent life insurance such as whole life and universal life. These differences go way beyond price. The proper way to compare life insurance is to compare the net cost of different options. The people pushing term insurance use a marketing gimmick known as “buy term and invest the difference”. The problem is:

Nobody invests the difference!

If you want a policy that will protect your family for life, a permanent policy is the only option. If you want a better net cost, again you want to be looking at permanent coverage. The net cost is much lower than term insurance.

The Risks of Term, Look at the Math: A male 35 will pay $950 annually for $1,000,000 of term (for a female, a little less). The 10-year net cost of this policy is a LOSS OF $9500Over 30 years, the policy will have a net loss of $28,500. The term policy will lapse at age 65 with no value. If this person is healthy, he has 20 more years to live, using today’s projections. If the person is unhealthy, he will be unable to get life insurance or it will be un-affordable. Millions of people over 60 today cannot afford what is available to them.

The Advantages of Permanent Life Insurance: On the other hand, the same 35 year old can buy a permanent policy for $9525. Yes, the premium is significantly more than an equivalent term policy and this automatically rules out all the people who currently do not have the cash flow to buy a permanent policy. The $9525 premium is guaranteed to stop at age 65. The 10-year net cost of this policy is projected to be a GAIN OF $2721. The 20-year net cost is a GAIN of $97,816 and the 30 year GAIN is $343,059.

Over 30 years, the net cost for term is a negative $28,500. The projected gain, using the current dividend scale, is a stunning $343,059. If you would you like to see a simple presentation customized for you, please complete this form and we will be in touch or feel free to call us at 561-771-4647.

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A permanent policy will remain inforce as long as you need it to without any new medical information. The equity in the policy can be tapped at anytime and today, many permanent policies offer Accelerated Benefits for health emergencies.

Why doesn’t every life insurance buyer own a permanent policy?

The number one reason young people select term insurance is affordability. Many young life insurance buyers do not currently have the necessary cash flow to purchase permanent life insurance, and that forces them to purchase term. In too many cases, the term policy that was selected only for its lower cost is not replaced with a better, more appropriate permanent policy, when it is affordable. The right insurance professional should be stressing the importance of replacing the term policy as soon as possible. Term insurance is the right product only if your need for coverage is temporary. Paying premiums into a term policy is throwing away money 97% of the time because 97% of all term policies lapse before paying a claim.

Most young people underestimate their desire to have life insurance later in life. People over 50 want insurance for life to protect their spouse, children or grandchildren.

If you have not looked at the net cost advantages of permanent life insurance recently, you might be surprised at its low premiums and low net cost. The entire process, from quotes to underwriting, can be done online and, in many cases, there is no medical exam at all.

Why Permanent Life Insurance?

  • The net cost of permanent life insurance is superior to term.
  • Does not expire, is there when you need it most, one policy for life.
    • Consult with an experienced insurance professional to get a customized policy.
        • Secondary market value. A permanent policy can be sold for cash if you do not need or want the policy after age 70. Typically, you cannot sell a term policy in the secondary market if it can’t be converted.

The following video speaks to the virtues of permanent life insurance.

You can visit us at www.facebook.com/lifecycleplanners

https://en.wikipedia.org/wiki/Whole_life_insurance l https://en.wikipedia.org/wiki/Life_insurance#Permanent_life_insurance

Also published on Medium.


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