What Type And Amounts Of Life Insurance Would You Recommend He Buy?
Posted June 23, 2009 – 4:20 pm in: structured settlements FAQAn individual has an overall need of $500,000 in life insurance. He is 35 years old, however, at age 65 his mortgage and childern’s education needs wil not be necessary and he will only need$100,000 in life insurance frome age 65.
Tags: Amounts, Insurance, Life, Recommend, Type, What, Would
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lifeinsurance.awardspace.info – try this one. I have their insurance and, as remember, they can provide such a service.
In a perfect world – this individual should consider purchasing $400,000 of 30-yr level term insurance along with $100,000 of permanent, whole life insurance. Term insurance is relatively affordable – even for that amount, whereas whole life is more costly. If not financially able, then they would be best advised to purchase all term insuance for now (the $500,000) and when able, “convert” $100,000 into a whole life plan. Be mindful, insurance rates are based upon age and health; hence, the younger this person is, the lower the rates. Needless to say, waiting until say, age 40 would cost more.
Hope that helps.
There are many options (and many good ones)…here’s one.
Buy a $500,000 Return of premium term policy and at the last month of the policy you convert it to a $100,000 using the $20,000-$30,000 cash from the return of premium as the ‘down payment’ (for lack of better term) on the new policy (which wouldn’t need to be medically underwritten by the way – if you buy it from the right company).
Your premium on the new policy would be minimal AND it gives you options because you could also just walk away with the cash should you need it (and not the insurance). And the return on the ROP policy for someone that age (and healthy) is 5.7% guaranteed and tax free. That’s a no-brainer.
One option would be a $400,000 30 year level term life insurance, and a $100,000 30 year renewable level term life insurance policy.
Or, you could request a $500,000 30 year level term life insurance policy with the option to renew $100,000 of coverage at the end of the policy.
A third option would be a $400,000 30 year level term life insurance policy and a $100,000 permanent life insurance policy, but this would be your most costly option.
I hope that helps. Bets of luck to you.
Depending on how easily he can afford it, the first two answers are good BUT another choice is $500,000 of convertable term and convert $100,000 over to whole-life later if it is still needed.
Shop rates with your local independent agent. He should shop you with at least 25 to 50 companies before choosing who to place you with.
A 30 year term for 400,000 would cover his debt. If you put the other 100K in a whole life policy it would be pretty expensive but it would probably be the best way to go if that is what is truly needed.