Life insurance is a contract between a life insurance company and a policy owner. A life insurance policy guarantees the insurer pays a sum of money to one or more named beneficiaries when the insured person dies in exchange for premiums paid by the policyholder during their lifetime.

Term Life Insurance

• Term life insurance is a simple, low-cost policy, and its main purpose is to replace your income when you die
• Typically sold in lengths of one, five, 10, 15, 20, 25 or 30 years
• Coverage amounts vary depending on the policy but can go into the millions
• Pros: the cheapest of all life insurance options
• Con: if you outlive your policy, your beneficiaries won’t receive a payout

Whole Life Insurance

• Whole life insurance typically lasts your entire life as long as you keep up with premiums, which are higher than premiums of other life options
• Guaranteed rate of return on policy’s cash value
• Death benefit amount doesn’t change
• Pros: usually covers you for your entire life, builds cash value and is relatively simple compared with other permanent life insurance options
• Cons: typically more expensive than term life

Universal Life Insurance

• Universal life insurance is permanent life insurance that can flex to future needs
• Allows you to adjust your premiums (within limits) and has a cash value component that grows based on market interest rates
• Premiums typically increase over time, forcing you to increase your premium payments or cover rising costs by subtracting from your cash value account or death benefit
• Pros: typically less expensive than whole life insurance and can adapt to your needs as life changes
• Cons: The death benefit and cash value growth are not guaranteed

Index Universal Life Insurance

• The cash value growth is tied to a stock or bond index like the S&P 500

Variable Life Insurance

• Allows for greater control over cash value investments, but higher risk
• Tied to investment accounts, such as bonds and mutual funds
• Premiums are typically fixed
• Death benefit is guaranteed, regardless of how the market fares
• Pros: There is potential for considerable gains if your investment choices do well
• Cons: It requires you to be hands-on in managing your policy because the cash value can change daily based on the market

For more information, please contact Lan Than at 713-569-0590 or email Ltinsurancegroup@gmail.com