Term and Whole Life Insurance from Kyle Insurance
Secure your loved one's future and help protect your estate with a Life Insurance policy. Kyle Insurance offers several different types of life insurance policies that can help with final expenses, pay estate taxes, leave an inheritance or replace lost income due to a death. We can write a policy to your specific needs. Give us a call today or use the form on this page to get a Free, No Obligation Quote.
Life Insurance Basics
Many financial experts consider life insurance to be the cornerstone of sound
financial planning. It can be an important tool in the following situations:
1. Replace Income for Dependents
If people depend on an individual’s income, life insurance can replace that income if the person dies. The most common example of this is parents with young children. Insurance to replace income can be especially useful if the government- or employer-sponsored benefits of the surviving spouse or domestic partner will be reduced after he or she dies.
2. Pay Final Expenses
Life insurance can pay funeral and burial costs, probate and other estate administration costs, debts and medical expenses not covered by health insurance.
3. Create an Inheritance for Heirs
Even those with no other assets to pass on, can create an inheritance by buying a life insurance policy and naming their heirs as beneficiaries.
4. Pay Federal “Death” Taxes and State “Death” Taxes
Life insurance benefits can pay for estate taxes so that heirs will not have to liquidate other assets or take a smaller inheritance. Changes in the federal “death” tax rules through January 1, 2011 will likely lessen the impact of this tax on some people, but some states are offsetting those federal decreases with increases in their state-level estate taxes.
5. Make Significant Charitable Contributions
By making a charity the beneficiary of their life insurance policies, individuals can make a much larger contribution than if they donated the cash equivalent of the policy’s premiums.
6. Create a Source of Savings
Some types of life insurance create a cash value that, if not paid out as a death benefit, can be borrowed or withdrawn on the owner’s request. Since most people make paying their life insurance policy premiums a high priority, buying a cash-value type policy can create a kind of “forced” savings plan. Furthermore, the interest credited is tax deferred (and tax exempt if the money is paid as a death claim).
Types of Life Insurance
There are two major types of life insurance: term and whole life.
1. Term Life
Term insurance is the simplest form of life insurance. It pays only if death occurs during the term of the policy, which is usually from one to 30 years. Most term policies have no other benefit provisions. There are two basic types of term life insurance policies: level term and decreasing term. Level term means that the death benefit stays the same throughout the duration of the policy. Decreasing term means that the death benefit drops, usually in one-year increments, over the course of the policy’s term.
2. Whole Life/Permanent Life
Whole life or permanent insurance pays a death benefit whenever the policyholder dies. There are three major types of whole life or permanent life insurance— traditional whole life, universal life, and variable universal life, and there are variations within each type.