Fifty years ago, most insurance policies offered by the insurance and mutual fund companies. The choice was limited to the period of contribution or whole life policy. It's simple, you pay a higher premium and the insurance companies that guaranteed death benefit. All that changed in the 1980s, interest rates soared and owners surrender policy, they will invest the cash value of the interest payments that exceed the non-insured in the event the insurance company begins to pay attention to it. The policy does not guarantee
Compared to the warranty policy is not guaranteed.
Today the company offers a variety of warranty and non-warranty insurance. Warranty is one of the insurer's risk and guarantee a death benefit in exchange for the payment of premium. If the minimum investment or cost to insurers who have to absorb the loss. The policy does not guarantee ownership in exchange for a lower premium, and may be a better return on investment is assuming a lot of risk, including the insurer has the right to increase the policy. If things do not work out as planned policy owner has to absorb costs and higher insurance premiums.
Term policy
Life insurance period The Premium is set at a reasonable and clearly stated in the policy. Annual renewable term policy premium will go up every year. Long-term policy in which the premium was higher in the first place has not changed for a specified period, usually 10, 20 or 30 years and it will become a current annual premium is up. you reach the age of
Permanent policy
Permanent protection: both universal and variable life is more confusing because the same policy, depending on how often will either be guaranteed or not guaranteed.
All permanent life insurance policy is a hypothetical illustration and include ledgers shows that the policy is carried out under the assumption that the guaranteed and non-guaranteed. (For more information see: that permanent life insurance.) Fees for return policies are usually displayed at the top of each column ledger and certain policies such as life or variable index shows sometimes assume that optimistic. a 7-8% annual return.
These displays usually have no guarantee premium is calculated on the assumption that the rate of fees and return policies will change. The payment under the premium is good as long as it meets or exceeds the performance of the policy assumptions in the illustration. If the policy does not meet expectations, then the owner will have to pay higher insurance premiums and / or reduced benefits for death or coverage may expire prematurely.
Some permanent policies have riders for an additional cost as part of the contract and the guarantee policy will not expire. Although insurance policy cash value is reduced to zero as long as the planned premium is paid as scheduled. Depending on how the policies and the premium is calculated to guarantee not delivered since a few years from the age of 121, but in exchange for the transfer of risk to the insurer for these policies often. Premium will have a higher value and less cash.
How to decide
Whether you should buy life insurance that does not guarantee or warrant depends on many factors.
Here are some factors to be considered.
If necessary, you will be able to pay higher insurance premiums?
Most people who buy a universal life insurance policy over the past 10-20 years 5-7% on fixed rates are the norm, never imagining the financial collapse in 2008, or an extended low interest rate that we are experiencing. These policies have now only 2-3%, and owners often retirees are faced with paying higher insurance premiums or a significant loss of coverage.
Why buy life insurance?
Insurance is unique because it allows you to have a liquidity event at some time and transfer the huge risks that you otherwise could not afford to pay out of pocket. If you are like most people buy life insurance to elevation. (Premium small / large death benefit), you might want to not worry about the policies that are in force.
You want to invest and grow our premium cash value or not?
Many insurers promote the interests of the residents of permanent life insurance with growth of tax-free cash value, the ability to invest in mutual fund sub-accounts or products index and borrowing against the cash value or surrender part. If the cash value of these benefits are important to you, then the warranty coverage may not be the best option.
How long do you want coverage for it or not?
For many people, long-term policy on the 20 or 30 years might be enough to pay off a mortgage or finance a child's education. And some can convert term insurance. (view more:. What is the insurance policy conversion.) But if you want coverage for your entire life, for example as part of the estate plan, you will need to have policies in force. At least until the age of 95 or 100.
Bottom Line
It is important to think about why you buy insurance and how it fits into your financial picture. The main reason for insurance is to transfer risk and increase the risk of insurance may not make sense.
Today the company offers a variety of warranty and non-warranty insurance. Warranty is one of the insurer's risk and guarantee a death benefit in exchange for the payment of premium. If the minimum investment or cost to insurers who have to absorb the loss. The policy does not guarantee ownership in exchange for a lower premium, and may be a better return on investment is assuming a lot of risk, including the insurer has the right to increase the policy. If things do not work out as planned policy owner has to absorb costs and higher insurance premiums.
Term policy
Life insurance period The Premium is set at a reasonable and clearly stated in the policy. Annual renewable term policy premium will go up every year. Long-term policy in which the premium was higher in the first place has not changed for a specified period, usually 10, 20 or 30 years and it will become a current annual premium is up. you reach the age of
Permanent policy
Permanent protection: both universal and variable life is more confusing because the same policy, depending on how often will either be guaranteed or not guaranteed.
All permanent life insurance policy is a hypothetical illustration and include ledgers shows that the policy is carried out under the assumption that the guaranteed and non-guaranteed. (For more information see: that permanent life insurance.) Fees for return policies are usually displayed at the top of each column ledger and certain policies such as life or variable index shows sometimes assume that optimistic. a 7-8% annual return.
These displays usually have no guarantee premium is calculated on the assumption that the rate of fees and return policies will change. The payment under the premium is good as long as it meets or exceeds the performance of the policy assumptions in the illustration. If the policy does not meet expectations, then the owner will have to pay higher insurance premiums and / or reduced benefits for death or coverage may expire prematurely.
Some permanent policies have riders for an additional cost as part of the contract and the guarantee policy will not expire. Although insurance policy cash value is reduced to zero as long as the planned premium is paid as scheduled. Depending on how the policies and the premium is calculated to guarantee not delivered since a few years from the age of 121, but in exchange for the transfer of risk to the insurer for these policies often. Premium will have a higher value and less cash.
How to decide
Whether you should buy life insurance that does not guarantee or warrant depends on many factors.
Here are some factors to be considered.
If necessary, you will be able to pay higher insurance premiums?
Most people who buy a universal life insurance policy over the past 10-20 years 5-7% on fixed rates are the norm, never imagining the financial collapse in 2008, or an extended low interest rate that we are experiencing. These policies have now only 2-3%, and owners often retirees are faced with paying higher insurance premiums or a significant loss of coverage.
Why buy life insurance?
Insurance is unique because it allows you to have a liquidity event at some time and transfer the huge risks that you otherwise could not afford to pay out of pocket. If you are like most people buy life insurance to elevation. (Premium small / large death benefit), you might want to not worry about the policies that are in force.
You want to invest and grow our premium cash value or not?
Many insurers promote the interests of the residents of permanent life insurance with growth of tax-free cash value, the ability to invest in mutual fund sub-accounts or products index and borrowing against the cash value or surrender part. If the cash value of these benefits are important to you, then the warranty coverage may not be the best option.
How long do you want coverage for it or not?
For many people, long-term policy on the 20 or 30 years might be enough to pay off a mortgage or finance a child's education. And some can convert term insurance. (view more:. What is the insurance policy conversion.) But if you want coverage for your entire life, for example as part of the estate plan, you will need to have policies in force. At least until the age of 95 or 100.
Bottom Line
It is important to think about why you buy insurance and how it fits into your financial picture. The main reason for insurance is to transfer risk and increase the risk of insurance may not make sense.
ความคิดเห็น
แสดงความคิดเห็น