Life Insurance

Life insurance for familiesWhen you die, will your LOVED ONES BE PROTECTED FINANCIALLY?  What if you live to a ripe old age or require lengthy medical assistance before you die?  Are you interested in finding a significant way to MINIMIZE TAX LIABILITY during retirement and to your heirs?

What is Life Insurance?

The main purpose of life insurance is to provide financial security for the family, should the main bread winner pass away.  It acts as an income replacement vehicle.  It provides protection against loss of income from the death of the insured.  But, now it can do much more than that.

Over the years life insurance has changed to provide much more than just a survivor benefit, such as cash availability, through loans, for anything you wish to purchase.  It can provide cash value, downside protection against investment losses, cash availability for terminal illness, chronic illness or nursing home needs.

FESA specializes in helping you determine which type of life insurance may be appropriate for you.  You may need to meet health criteria to qualify, demonstrate a need for the death benefit and be able to pay the premiums.

Main Type of Insurance:

  1. Insurance PolicyTerm Insurance:  Typically used as a death benefit to replace income.  It is also used as Buy-Sell funding in business partnerships and for protection on loans such as mortgage insurance or bank loans.  It can be taken out for a variety of years, determined by your specific needs.
  2. Whole Life:  Historically, this was the traditional life insurance used for growth of cash value.  It usually contains guaranteed rates of return, along with the ability to increase the death benefit.  Used by people who want the guarantees built into the policy, which provides them the security of a given value at a later date.
  3. Second to Die Policy:  These policies are used, mainly between spouses, to reduce the premium costs and pass on the survivor benefit to an heir(s) beneficiary other than the spouse.
  4. Indexed Universal Life (IUL):  In addition to the survivor benefit, this policy is designed to give you the most flexibility of all the life insurance policies. Some of its features include:
    • Access to cash value funds without tax consequence:  This is accomplished through policy loans from the Insurance Company’s general fund.  You will pay an interest rate, while getting an interest rate on your cash value.  Money can be used for any expenditure.
    • Unlimited premiums permitted up to $ 1,000,000:  The goal is to minimize the death benefit and maximize the premiums put into the policy so that advantage is made through utilizing cash value.
    • Downside protection with no risk of loss to principal when the stock market drops.  Your cash value is protected from losses because it is not invested directly into the Stock Market.  It is backed by the claims paying ability of the Insurance Company.  FESA only works with well-established carriers with proven track records.
    • Tax-free Survivor benefit protection:  This benefit is paid to the designated beneficiary(s) upon the death of the insured.  It is a tax free benefit and is not included in the deceased’s estate for probate purposes.  In many cases the beneficiary decides how the benefit is paid.
    • Sunset FamilyTerminal or Chronic Illness protection:  This is a benefit that allows the insured to access a portion of their death benefit, while they remain alive, when diagnosed with a terminal illness (usually 2 years or less to live) and/or 2 of the Activities of Daily Living:  feeding, toileting, selecting proper attire, grooming, maintaining continence, putting on clothes, bathing, walking and transferring (such as moving from bed to wheelchair).
    • Very respectable indexed growth rates on assets.  Annual rates for the past 20 years have been consistently 7-8%.
    • Guaranteed minimum growth rates.  Many policies provide a minimum interest rate ( usually 1%) on your cash value if the index you have chosen produces nothing.

FESA is honored to be able to help you decide which type of life insurance may be appropriate for your needs.  We accomplish this through reviewing your current situation and your considering future goals.  If you are interested in or would like more information about any of these products, please enter your information or contact us at (303) 887-4231 and we will be happy to help you.