Term vs Permanent Life Insurance

Buying life insurance is not on the top of everyone’s priority list. It makes us think about dying and how we have to plan for it when we leave family members behind. Morbid, yes. Necessary, absolutely. Life insurance is the best present you can give your family. There are two main options when buying life insurance – Term Life Insurance and Permanent Life Insurance.

life insurance policy

As the name implies, Term Life Insurance is for a specified term or time period. Policies can range from 1-30 years for a term. This type of life insurance is relatively inexpensive because it does not build any cash value and it just ends when the term expires. The payments are at a fixed rate until the end of the term. If future life insurance is needed, the rate will most likely go up because the person buying it is now older (an influence on the rate of a policy) and could have health issues that were not present when first buying the term insurance. If the purchaser does die during the term of the policy, the beneficiary will receive full payment of the policy. This type of life insurance can be used for the purpose of covering a mortgage. If you have a 30 yr mortgage, you may buy a 30 yr term policy just to cover your mortgage payments if you die within that time period.

Permanent Life Insurance, sometimes called Whole Life, will initially be more expensive. However, the rate on the policy will not change regardless of any changes in health or occupation, as long as timely payments are made. A significant difference from Term Life Insurance is that Permanent Life Insurance will build up cash value. Over time, the policy value will be increasing by more than the actual premiums. The owner will have access to this cash if so needed. In the end, Permanent Life Insurance will be more cost effective and provide a better solution to family planning.

If you have any questions about life insurance and family planning, please call us! mancuso-nowak.com

Marriage and Insurance

The summer is the most popular time to get married. With marriage comes a lot of important financial decisions to make. One of these financial decisions is on insurance. Do you combine and have one auto policy or do you keep your policies separate? Do you need life insurance?

Here are some factors to consider:

  • Married couples have lower auto rates. Actuaries determine insurance rates. They base their rates on statistics. Statistically speaking, married people get in to fewer accidents. Non-married people actually get into twice as many auto accidents.
  • If you are buying a new house/condo now that you are married you can receive multi-policy discounts with your home and auto together.

On the other hand:

  • If your spouse has a bad driving record with lots of tickets and accidents, your premium will go up. So it would be better to keep separate policies.
  • If your spouse has a much more expensive car to insure than you, you may want to keep your policy separate.

Life insurance is always important to have, but once you are married many of your finances are combined. You make joint investments, such as buying a house/condo. With such large joint investments, it would be difficult for just one of you to make all the payments if something happened to your spouse. This is why life insurance is so crucial. It not a fun thing to do…thinking of a loved one passing away, but preparation is the best policy. Even if both of you have life insurance through work, it is also smart to buy a separate policy for each of you. If one of you loses his/her job, all the money invested into the company life insurance is gone. You don’t have life insurance anymore. On the other hand if you are putting money into personal life insurance policies they are always there. Think of your husband/wife, would you want them to struggle finically if something happened to you? Buying life insurance could be the most thoughtful and caring thing you buy!

If you have any questions on your policies after marriage, please call us and we can discuss all of your options! mancuso-nowak.com/coverage/personal/#/

* Beautiful wedding picture from one of our employee, Nina Arroyo!

Everything You Want To Know About Life Insurance

What better gift is there than life insurance for Valentine’s Day? We think it is one of the best! Buying life insurance is one of those things you always put off because you never want to think about anything happening to you or your family. However, life insurance is a necessity and will help those who are left behind when you pass away. Life insurance lets your loved ones remain financially secure after you are gone. Some of the life events that prompt people to buy life insurance are getting married, having a child, becoming a homeowner or changing jobs.

family

Take getting married for example, once you are married many of your finances are combined. You make joint investments, such as buying a house/condo. With such large joint investments, it would be difficult for just one of you to make all the payments. This is why life insurance is so crucial. Even if both of you have life insurance through work, it is also smart to buy a separate policy for each of you. If one of you loses his/her job, all the money invested into the company life insurance is gone. You don’t have life insurance anymore. On the other hand if you are putting money into personal life insurance policies they are always there.

How much life insurance do you need to buy? Many times people only buy 4 times his/her annual income, when in reality you will probably need closer to 10 times your annual income. Think of all the expenses life insurance needs to cover: funeral costs, mortgage, car loans, credit card debt, taxes, education, retirement, and list goes on. An equation you can use to help determine your life insurance needs is:

current and future financial obligations – (spouse’s earnings, savings, investments and life insurance already owned) = amount of life insurance

There are two main types of life insurance: term and permanent life insurance. As the name implies, Term Life Insurance is for a specified term or time period. Policies can range from 1-30 years for a term. This type of life insurance is relatively inexpensive because it does not build any cash value and it just ends when the term expires. The payments are at a fixed rate until the end of the term. If future life insurance is needed, the rate will most likely go up because the person buying it is now older (an influence on the rate of a policy) and could have health issues that were not present when first buying the term insurance. If the purchaser does die during the term of the policy, the beneficiary will receive full payment of the policy. This type of life insurance can be used for the purpose of covering a mortgage. If you have a 30 yr mortgage, you may buy a 30 yr term policy just to cover your mortgage payments if you die within that time period.

Permanent Life Insurance, such as Whole Life, will initially be more expensive. However, the rate on the policy will not change regardless of any changes in health or occupation, as long as timely payments are made. A significant difference from Term Life Insurance is that Permanent Life Insurance will build up cash value. Over time, the policy value will be increasing by more than the actual premiums. The owner will have access to this cash if so needed. In the end, Permanent Life Insurance will be more cost effective and provide a better solution to family planning.

Being prepared is the best way to provide a secure future for your loved ones, should you pass away. Buying life insurance could be the most thoughtful and caring thing you can do this Valentine’s Day! Call us to find out more about your life insurance options www.mancuso-nowak.com.

Insurance Policy Discounts

Are you getting the best deal on your insurance? Make sure you are taking full advantage of the discounts offered. One of the more common credits with your home and auto policies would be alarm systems. Other than the actual system and its capabilities, it shows the insurance company that you are concerned about protecting your personal property. Also, most companies will offer a significant discount when you insure both your auto and home with them, a multi-policy discount. When you have more than one policy with the same company it shows them that you have faith in them and their products. Loyalty is a big factor.

 piggy bank

Some other common discounts include, but are not limited to:

  • Everyone is “going green”, so if you eliminate the printing of your policy and have it emailed to you instead, you will receive a discount.
  • Low mileage discount, if you are more of a local area driver, this is the discount for you.
  • Pay your premium upfront and receive a discount.
  • If you are part of AAA or AARP, you will receive a discount.
  • Are you or your children on the honor roll? Receive a good student discount.
  • Business (commercial) insurance will enjoy similar discounts as personal insurance, such as alarm systems and larger deductibles.

By selecting a larger deductible on any type of policy, commercial or personal, you receive a discount. Again you are showing the insuring company that you are invested in protecting your property. If you know that you will have to pay the first $1,000 of a loss you are more likely to use extreme caution while driving and/or caring for your home/business.

In life and health insurance policies the better you take care of yourself, the more of a discount you receive. The most prevalent would be smoking. Non-smoker rates are considerably less than smoker rates. Your nutrition and health habits will determine the rates that the company uses to determine premiums. Eat a healthy diet and exercise and your rates will be better. The younger that you start a life insurance policy the better your rate will be also. Thinking about death at a young age is a daunting task, but it will prepare you for the future and guarantee better rates. So set up your life insurance now!

Always ask about additional discounts to ensure the best premium. Call us for more information! mancuso-nowak.com