Life Insurance Broker Discusses the Types of Life Insurance Available
As an experienced Life Insurance Broker, I get questions all the time from physicians and dentists inquiring about the different types of life insurances that are available. The two basic types of life insurance are term life insurance and permanent life insurance. There are so many different types that it becomes very confusing. If you think of it in this simple way it will help you: Term Insurance is temporary; you’re paying for a policy that’s going to provide coverage or a death benefit for a specific period of time – 10 years, 20 years, 30 years. Since that time period is finite, the insurance companies offer very low rates as, and really only pay 2% of those claims. That doesn’t mean that you don’t need to go out and get life insurance because it’s really not about you, it’s about your family. You can’t take the risk for them. Those rates are like renting for that period of time, so they’re going to be lower.
The permanent plans are going to have a higher premium because there’s going to be a death benefit that’s for the rest of your life. You can put extra money into those policies for other cash needs that you have down the line. So, it’s not really fair to look at the premium or the expenses until you understand what you’re trying to accomplish with that policy. If it’s just a death benefit, then it’s much easier to look at the two different types of plans and which one might be best for your situation.
In most cases, clients have multiple plans; some for temporary needs, and some for needs that are permanent and the requirement for having additional cash for either college education or to supplement retirement.
If you are a physician or dentist and have any questions about the different life insurance policies, contact our professional Life Insurance Brokers for guidance. Let our knowledge work for you.
This educational blog was brought to you by Life Insurance Broker Michael J. Bruno, seasoned Chartered Financial Consultant, Chartered Life Underwriter and Registered Health Underwriter. Specializing in financial planning and life insurance for physicians and dentists for over 30 years.