Insurance Insights

Published 12:00 am Wednesday, April 4, 2001


Life insurance is for those who survive Life insurance is a practical way to protect your familys financial hopes and dreams. The death of a family member can be devastating to survivors both emotionally and financially. Life insurance can provide cash to help with a familys immediate and long term needs.

Immediate needs include funeral expenses, unpaid medical bills and taxes.Long-term needs include care for a disabled or elderly family member, college expenses, outstanding debt, loss of income and general living expenses the family will face.Life insurance is not for the people who die, but for the people who remain. It is wise to explore options while you are still healthy. Health problems can make life insurance expensive or unavailable. Three forms of life insurance are most common.Term life insurance. This is temporary life insurance for a specific time period (one, five, 10 or more years). It provides short-term coverage and is generally the most economical form of life insurance. Term insurance, however, costs more as you get older.Whole life insurance. Premiums are generally level (stay the same) with cash value growth possible through the life of the policy. Cash values can be borrowed (with interest charged) during the insured persons lifetime to help meet temporary or emergency needs. Funds borrowed reduce the death benefit and cash surrender value.Universal life insurance. This offers many traditional advantages of whole life insurance, such as protection for life, but also offers flexibility. Coverage amounts and premium payments are flexible to help meet changing needs during ones lifetime (subject to certain conditions).When you buy life insurance, you buy a promise of protection against financial loss caused by death. The promise is only as good as the company that stands behind it. Be an informed buyer. Consider the financial strength of the insurer and its customer service track record. Learn more about the various life insurance products and which best suits your needs.MIKE WILLIAMS, a local State Farm Insurance agent, writes this column regulary for LObservateur.