Life insurance polices
Flexible premium policies
Adjustable life- term and Permanent ( increase and decrease premium or period, face amount or change period of protection) proof of insurability to increase death benefit or to lower premium Universal life- flexible premium adjustable life Skip payments and takes from cash value Will expire if no cash value minimum premium- keep policy in force for year Target premium- recommend amount for life time Guaranteed con target interest rate 3-6 percent. Could get current interest rate 2 components- insurance component( annually renewable term insurance) Cash account Option A- level death option( death benefit level while cash increases ( specified corridor or gap between benefit and cash) IRS Option B- increasing death benefit option Indexed whole life- cash value dependent on s&p 500 guaranteed interest rate( face amount increase annually with inflation without evidence of insurability
whole life insurance
Build in cash value and remain in effect for whole life until 100 pays out Endow- face amount= age 100 Level premium- based on issue age Cash value- guaranteed interest rate ( insurer and policy owner don't have to be same person Grows tax deferred and don't accumulate until 3rd year Types- Straight life (ordinary life)- lowest annual premium( paid until 100) Limited payment- paid up before 100 (20 and 65. Years) Single premium- paid up whole premium and gets cash value right away.
Credit Life Insurance
Decreasing term insurance ( individual or group Creditor is owner and beneficiary Can't pay out more then debt
Specialized policy
Joint life- (two or more lives) first to die (joint average age (for spouses) Survivor ship life( second to die paid) makes cheaper premium (offset liability of estate tax Juvenile life- face amount increase at 21 premium level
Group life
More than one person ( annually renewable term) Master contract for employer( certificate for employees) For other than getting insurance May be sponsored employers or debtor groups labor or credit union Related by marriage, insurable interest in each other life. No medical questions Convert without insurability based on age and can covert to anything besides term 31 days to switch Not given notice = 15 but no more than 60
Term Life Insurance
Pure death protection Greates amount lowest premium No cash value ( death benefit changes) Level- doesnt not change Level premium term- same and renewal= age Re entry- proof of insurablity lower rate Annually renewable term- no proof and renewal = age Decreasing- only death benefit goes down( mortgage other debts) ( convertible not renewable-
Variable products 1
Variable life insurance-level, fixed premium guaranteed minimum death benefit, cash value not guaranteed ( policy owner bears investment in separate account) Variable universal life- securities version of universal life( don't guarantee return) cash loans, flexible premium, increase and decrease amount Regulation- state and federal gov. Variable contracts are SECURITIES( SEC FINRA Insurance department) Need security license to sell and registers with FINRA 10 years of no charges 60 days waiting on files report separate acccount