Life insurance is a crucial pillar of financial planning, providing a safety net for you and your loved ones. When choosing a life insurance policy, you usually need to consider term, whole, and universal life insurance. This blog explores these options, shedding light on key information that can influence your purchase decision.

Key Features and Benefits of Term Life Insurance.

Term life insurance policies are affordable ways to get financial protection for a set period, based on the term you choose. If you die while your policy is still active, your beneficiaries receive a lump-sum, tax-free payment called the death benefit. They can use this money in any way they choose.

• Ideal for those seeking affordable coverage for a specific period.
• Allows you to choose the duration of coverage.
• Provides financial protection during the chosen term.
• Term life is a good choice for those seeking coverage for a set timeframe. It is often used as a smart replacement for bank-offered mortgage insurance.

What’s the Benefit of Whole Life Insurance?

Whole life insurance provides coverage for your entire lifetime and accumulates a cash value, providing an additional savings component. Cash values and death benefits grow throughout your life, and the policyholder can withdraw or borrow against the cash value amount, providing access to their funds at all times. A permanent policy of any type will have a higher cost than a term policy because the death benefit is guaranteed to pay out.

• Provides coverage for the entire lifetime of the policyholder.
• Accumulates a cash value that is guaranteed to increase over time.
• Policyholders can withdraw or borrow against the cash value amount, providing access to funds.
• Offers a death benefit and a savings component.
• Ideal for individuals seeking permanent protection and access to cash.

Why Would You Buy Universal Life Insurance?

Universal life Insurance offers a death benefit and an investment component. Policyholders can adjust their premium payments and death benefits based on their circumstances. The policy cash value earns interest at a low variable guaranteed rate, which can be used to cover premiums or withdrawn.

• Combines a death benefit with an investment component.
• Policyholders can adjust premium payments and death benefits.
• Policyholders can choose their own investments.
• The cash value can be used to cover premiums or withdrawn.
• Well-suited for individuals seeking both protection and potential investment returns.

Selecting an Insurance Product Right for You.

Your purchase decision hinges on factors unique to your individual circumstances and priorities. If affordability is a top priority and you need coverage for a specific period, term life insurance might be the optimal choice. It allows you to tailor the duration to your needs—10, 15, 20, or 30 years.

For those seeking lifelong coverage and a savings component, whole life insurance offers stability and the accumulation of a guaranteed cash value. The flexibility to adjust premium payments and death benefits makes universal life insurance an attractive option for those who desire adaptability over time.

To determine the right fit, consider your financial goals, budget constraints, and the duration of coverage you need.

Consulting with a Financial Planner.

Consulting with a financial planner can provide personalized insights into your unique situation. Given the complexity of life insurance choices, seeking guidance from a financial planner is essential. This advice will help you make an informed decision that aligns with your goals and aspirations, ensuring financial security for you and your loved ones.

Our very own life insurance expert, Christina Wyatt, Managing Advisor – Life Insurance Division, is here to help our Bauld Insurance clients. She will analyze your financial goals, budget constraints, and long-term plans to help you make an informed decision aligned with your unique circumstances. Visit our life insurance page to schedule a 15-minute call with Christina.

Life insurance is a key piece in securing your financial future, and the variety of options can be overwhelming. Understanding life insurance products like term, whole, and universal life empowers you to make a decision that aligns with your needs and aspirations. This knowledge will help you make an informed choice to protect you and your loved ones.