Life Insurance

Life Insurance 101: Why Life Insurance Matters

Not just another financial product; life insurance is a key strategy to safeguard your family’s future. Proper planning can help avoid financial issues after the death of a family member. Depending on the product, it can provide more than peace of mind—life insurance can provide options.

To begin with, your specific needs will guide which product best suits your scenario. How you decide what your needs are and which products are available is where Iowa Bankers Insurance & Services, Inc. can assist.

We have tools to help you identify which needs are most important. Once those needs have been assessed, we can look into which product(s) may best suit those needs.

Understanding Your Options

There are two categories of life insurance that work for most people: term and permanent.

Term Life Insurance

Term coverage is just like it sounds. It provides a level premium period for a set number of years (the term) and is always going to be the least expensive coverage you can find. Typical term policies do not end after the level term period, but the premiums do start to increase each year after that point. That’s why term insurance is not a long-term solution, but it can provide the largest amount of coverage for the lowest cost. This product works well for clients attempting to cover large amounts of debt, like a mortgage or a young family’s needs. Some term policies allow the option of converting to a permanent policy down the road, which can be helpful if a client were to have health issues and become otherwise uninsurable.

Return of Premium is an option when clients would prefer not to pay for term coverage, knowing there may be no return for all they have paid. This product is more expensive than regular term, but it is exactly what it says. At the end of the level term period, if no death benefit has been paid and the policy is paid current, a client can choose to cancel their policy and take a refund of their premiums paid. Or they can leave the premiums with the company and use those to purchase a smaller face amount, paid-up policy—meaning no more premiums would be due.

Permanent Life Insurance

Permanent coverage is another option that comes in all shapes and sizes.

Whole Life Insurance is the most basic type of permanent insurance. It offers a guaranteed death benefit, cash values, and level premiums for the life of the policy. While whole life does cost more than term, there are options with whole life that do not exist with other types of life insurance. Because of the cash value feature, there are non-forfeiture options that include using that cash value to purchase paid-up insurance.

Whole life also offers Limited Payment options that allow a client to purchase coverage with one lump sum, often utilized by parents and grandparents to purchase paid-up coverage for children. Other limited pay options include 10- and 20-pay policies, which spread the premiums out over 10 or 20 years as opposed to paying for life. Again, for younger clients, this can be economical and provide paid-up coverage for later in life, when health issues arise and a client may become uninsurable.

Universal Life is yet another option to consider under the permanent insurance umbrella. Guaranteed universal life policies can provide permanent protection, but since they do not build as much cash value as whole life, they may be a more economical fit for someone wanting more than term coverage. Depending on the scenario, a combination of term and permanent policies may be the best fit. Beyond the scope of a basic policy, there are several riders to suit additional needs. From children’s term riders to waiver of premium riders (in case a health issue occurs, and premiums cannot be made for a period of time), just to name a couple.

As you can see, the options are many, and talking with an experienced agent can help you navigate various products and their benefits to find the best practical fit for your family and the best financial fit for your budget.

Agents – Partnering for Success

Joining forces with us means access to products, quoting tools, and insights to best serve your clients. We simplify navigating life insurance, as there is a plethora of products on the market today, and features on those products are just as vast. At Iowa Bankers Insurance and Services, Inc., we are all about equipping you to recommend the best options for your client’s individual scenarios.

Our team is also here to guide you through the process; help you find the best coverage to protect your future and your loved ones.

Life Insurance Companies

When shopping premiums on like term guidelines call for a comparison quote. Companies most likely to be quoted for their competitive rates are:

Direct Contracts

Additional Companies

For more information or to discuss your life insurance options, please reach out to Bethany Johnson or Michelle Smith today. We look forward to assisting you!