Types of Permanent Insurance
There are many types of permanent insurance out there, and each type can be complicated for a layperson to fully understand. Having a financial advisor is one way to ensure that your family is protected, no matter what happens. At Starlight Financial, we represent you, so we can build a portfolio that is tailored specifically for your needs. We will walk you through all the types of permanent insurance available and help you decide which is the most prudent choice for you.
Participating whole life insurance is a permanent life insurance policy between a policyholder and a mutual company. In a mutual company, the policyholder is a “participant” in the company and can receive dividends annually depending on how the company performs. A whole life policy is also a permanent life insurance policy, but it is offered by a stock company, so no dividends are paid. This type of insurance promises that as long as the policyholder pays the premium, a death benefit will be paid out, and the cash value of the policy will be equal to the death payout by a certain age.
Indexed Universal policies are flexible permanent policies, meaning the premiums and death benefits can be changed over the life of the policy. The cash value of these policies is indexed in a way that reflects broad market indexes such as DIJA, S&P 500, and others. The indexing portion can get complicated, but our advisors are here to help. Guaranteed Universal policies are a hybrid of permanent life insurance and term insurance. Instead of guaranteeing the policy for a set number of years like term insurance, the policy is guaranteed until a set age, such as 95 or 100. Guaranteed Universal policies have lower premiums, because they don’t build cash value. Variable life insurance
does build cash value, but through a fund that can be invested in a variety of separate accounts. This type of policy is also permanent insurance, but the values of these accounts vary, giving the type its name.
Single Premium Whole Life insurance is a type of permanent insurance that enables you to access the death benefit before you die in order to pay for long-term care. Anything leftover once you die will be the remaining death benefit that goes to your beneficiaries. With this policy type, you can choose to receive a fixed interest rate, or invest in a variety of accounts like stocks, bonds, and money markets.
Survivorship options are usually meant for married couples that want to make sure the other is cared for if one of them should die. These policies are often offered by employers, which are required to make joint and survivor annuities the automatic option for couples who are married at the age of retirement.
With all these options to choose from, it can be difficult to decide what you actually need. At Starlight Financial, we have professional advisors who want to make sure your family is protected and can walk you through all your options, so you can be confident you are choosing the one that best fits your situation. We currently have locations in the Louisville/New Albany area, Pikeville, Florence, and Lexington, KY, Linton, IN, Fredericksburg, VA, Phoenix, AZ, and Kingsport, TN, and we serve the surrounding areas. Soon, we will also have a location in southern Illinois.