When you move into adulthood, you quickly learn that there is insurance for just about everything. Cars, homes, health, and belongings are just a few important areas of life where it’s essential to secure a quality and affordable insurance policy. But are you aware that you can and should also obtain insurance for a person? Specifically, for yourself or your loved ones.

It may be uncomfortable or upsetting to think about yourself or a loved one dying, but buying life insurance coverage is a great way to secure financial protection and peace of mind in the event of an untimely death.

Before purchasing life insurance, though, it’s important to assess your needs, options, and financial situation. It is also important to address a few questions such as: How does life insurance work? Is all life insurance the same? Should everyone have life insurance? When is the best time to get a life insurance policy?

Below we’ve given a few answers to these questions.

What is Life Insurance?

Understanding what life insurance is and how it works is the first step in securing a life insurance policy. Life insurance is a contract between an individual and a life insurance company. This contract specifies that the policyholder will pay a premium for the duration of the life insurance term, and in turn, the insurance company will pay a financial sum to the policyholder’s named beneficiary upon the death of the policyholder. This sum is referred to as the death benefit.

Types of Life Insurance

Life insurance is not one-size-fits-all. You get to choose how much life insurance to carry and what type of coverage you need. There are two types of life insurance policies: Term and Permanent.

Term Life Insurance

Term life insurance is life insurance designated for a specific term. Usually 10, 20, or 30 years. With a term policy, you agree to pay the premium for life insurance coverage and if you die during the specified term, then your beneficiary receives the agreed-upon sum. Though, once the term expires, the contract expires. If you are still living when the term expires, you will either need to secure a new policy if you wish for your beneficiary to receive a death benefit.

Term life insurance policies are the most commonly selected type of policy. This is typical because term life insurance rates are the most affordable and can often be secured for a minimal monthly premium.

Permanent Life Insurance

Permanent life insurance is just that, permanent. These policies are designed to pay a sum to your beneficiary regardless of when you pass away. Another benefit to permanent life insurance is that the cash value grows with tax benefits and can even potentially be used during your lifetime. The two types of permanent life insurance are Whole and Universal. Each has different specifications and benefits.

Because the insurance company has a guaranteed payout at the end of a permanent policy, premiums are more expensive, though they carry a guarantee.

When Should You Get Life Insurance?

The basic rule of thumb is that younger is always better because it is more likely that you can lock in a lower rate when you are younger and healthier. But, the best time to buy life insurance will vary from person to person depending on their life circumstances, needs, and age.

Life Events

Below is an explanation of how different life events can affect your need for life insurance coverage.

When You Get Married

Marriage is a major life change. Securing a life insurance policy when you get married is a good idea because it can give you peace of mind that your spouse will be taken care of in the event of an untimely death. Likewise, your spouse will have a safety net to take care of themselves when you are gone.

When You Have a Baby

Starting a family is one of the most important reasons to secure a solid life insurance policy. Minor children cannot provide for themselves, therefore losing a parent can be detrimental emotionally and physically. Ensuring that your children are provided for when you pass on is a major responsibility that is provided by carrying life insurance.

When You Accumulate Debt

When you take on debt to go to school or to buy a house and other personal belongings, you of course, fully intend to pay that back. But if you die before you can pay, your family may be left with the burden of paying the debt. Carrying a life insurance policy large enough to cover all of your debt expenses is a great way to ensure that your family is not left with that burden.

Age Brackets

If you are alive, healthy, and under age 85, then it is never too late to get a life insurance policy. But, your age will determine your insurance needs and costs.

20s and 30s

Finding an insurance policy to lock in your 20s and 30s is typically going to be your most affordable option. Especially if your medical exam reveals that you do not have any concerning health conditions. This stage of life is when your insurance company assumes the least amount of risk because an early death is the least likely. Though, if you have young children at this time, it is likely one of the most important age brackets to ensure that you have coverage.

40s and 50s

Securing an insurance policy during your 40s and 50s is still affordable, though more expensive than in previous decades. During this time is when there is an increased risk that health concerns will arise, and therefore, more risk for the insurance company. Once you have reached this stage of life, you likely have accumulated assets and financial obligations that require coverage if something were to happen to you, therefore life insurance coverage is still a wise purchase.

60s and Older

Though being 60 and older seems like the most important stage to have a life insurance policy because the probability of passing away is getting closer, it may actually be the stage where you deem life insurance unnecessary. Your children are likely grown, and you may have significant savings and retirement accounts that can provide for your family members that are left behind. But it is still vital to assess your situation because if you do have outstanding debt and responsibilities when you pass, you want to ensure that your family members are taken care of.

Speak with an Agent

Hopefully, this information has helped you to understand the importance of carrying a proper life insurance policy. Are you ready to find the right policy for you and your loved ones? Or perhaps you have more questions that pertain to your specific circumstances.

At Gebhardt Insurance Group, our team specializes in finding the best policy for you. Our expert agents are well-versed in the specifics of each type of life insurance as well as which companies offer policies that will fit your needs and lifestyle the best.

Call us today to speak to an agent about your life insurance needs.

Turning 50 is a wonderful milestone and this time of life brings new adventures, challenges, and celebrations. You are now wiser, more respected, and still have much life to live without the stress of youthful inexperience. You are truly in your prime!

Part of taking advantage of this newfound freedom and aging gracefully includes making provisions for your belongings and loved ones in the event of your passing.

A recommended way to achieve this is by buying life insurance coverage. Now, you may have been told that having a life insurance plan is not available or necessary for people over 50. Perhaps your children are grown and have already attended college, your home and debts have been paid off, and you have a considerable amount of life savings. In that case, you may choose to opt-out of carrying life insurance.

But for those who still have young families, children in college, debts, or a spouse to care for after passing, life insurance is still necessary, even though you are over 50.

If you want peace of mind and reassurance of your loved ones’ financial stability once you are gone, a life insurance policy may be a viable option for you.  You have many options from which to choose your policy.

When shopping for life insurance quotes over the age of 50, there are several factors to consider:

Price

Naturally, aging means that you are getting closer to your life expectancy. Unfortunately, this means that insurers have less time to collect premium payments from you and an increased risk of paying out benefits as each year passes. Therefore, after turning 50, insurers pass this risk on to you in the form of higher premium payments, making life insurance more expensive.

Pricing increases do not only apply when purchasing new life insurance policies, though. They can also apply to existing policies. If you already have a life insurance policy, typical premiums will generally increase at age 50. Some policies may provide a guaranteed premium, while others have steadily increasing rates based on your age. All companies and policies are not the same, though. You can shop around to try and keep rates within a reasonable amount.

When turning 50, it is always advisable to look over your insurance policies. It may be an excellent opportunity to have an agent review your existing policy and compare it to a new policy’s pricing. You may find that it is more cost-efficient to switch policies depending on current rates and your health.

Aging Considerations

Most life insurance policies require a medical exam to be conducted at the time of purchase, no matter your age. But for people over 50, the likelihood of having a preexisting health condition is increased. Therefore it may be beneficial to take advantage of policies that waive this medical exam and offer guaranteed acceptance. In many cases, the premium payments for this type of coverage are higher. However, if you know that you have a disqualifying condition, you can ensure you still have excellent life insurance coverage for the benefit of your loved ones.

Policy Type

When looking at types of life insurance, you have many options. Below, we will focus on two categories of basic choices:

Term Insurance:

Term insurance is available for a designated amount of time. You can generally purchase term insurance for 10, 20, or 30 years. Once the term has passed, the policy expires. If you outlive your policy, you must then forfeit the premiums you have paid, buy a new term policy at a much higher rate, or purchase a different type of insurance. Some companies might offer the option of converting a policy before expiration.

The benefit of carrying term life insurance is that the policy is guaranteed to provide a death benefit if the insured person dies during the policy period. This is an excellent way to ensure that your family is cared for if you experience a tragic accident or sickness at an early age.

The hope is that you never need to benefit from term coverage since the only way to receive payment is through the insured’s death. Companies know that the risk of paying a death benefit is low for most. So to offset your costs, term insurance premiums are much less expensive than permanent insurance.

Permanent Insurance:

Permanent life insurance has several key differences from term life insurance and has many different variations available to purchase. The most notable difference is that permanent insurance lasts through your lifetime.

The two common types of permanent insurance are Whole Life coverage and Universal Life insurance. While similar in that they both have a guaranteed payout at the end of life and both have cash-value options, they differ in the amount that must be paid in premiums. Whole Life has a steady set amount that you must pay as long as you are living. In contrast, Universal Life has more flexibility in payment options. The interest of which is dependent on market conditions.

Because your insurance company will have to pay at the time of death, permanent life insurance premiums are much higher than term insurance. Permanent insurance may be a better option if you are looking for life insurance for a death benefit and a cash savings vehicle.

Your policy’s cash value can be taken out as a loan while you are living, but keep in mind that doing this may directly impact your death benefit amount, depending on your policy. You can utilize this type of policy to help pay for your children’s college or add to any other future cash need you see on the horizon. Permanent insurance can be used as a forced savings account to build financial strength for those who have trouble putting money aside and then used later when needed.

Permanent life insurance is an excellent option for those who need to guarantee financial stability for loved ones left behind. Many who have adult-dependent children or large estate tax payments often opt for permanent coverage.

Policy Benefits

Before purchasing life insurance, it is essential to assess your own needs to determine your policy’s benefits.

If you do not have dependents, debts, or savings accumulated elsewhere, you may not need coverage. Or you may opt to carry coverage that only covers funeral expenses.

Life insurance may be a good fit for you if you have minor children, anyone that is financially dependent on you, a mortgage to pay off, or limited savings.

If you are a business owner, you may need to protect your business and employees. Can your business financially sustain itself without you? If not, you may need a life insurance policy to protect your investment. This protection is an essential consideration for you as a sole business owner or for any partners necessary to the business.

Other situations not mentioned here may apply to you. Still, the overall consideration is that being over the age of 50 does not mean that life insurance is not available or necessary to you.

Your Insurance Needs

The options for life insurance coverage can seem overwhelming and difficult to understand or select. There are many factors to consider. It is exceedingly important to look at your entire financial picture and your goals before selecting a life insurance policy.

The first step is to identify your goals for a life insurance policy and then work with an experienced agent to find the right policy to achieve those goals.

• How close are you to your retirement goals?  
• Do you have people in your life that are financially dependent on you?  
• Do you need assistance with saving for the future?  
• How much can you realistically afford to pay in premiums?

These are all questions that you should consider and answer when selecting the policy that works for you.

At Gebhardt Insurance Group, we desire to connect you with the exact agent and policy that fits your needs. We are an independent insurance agency that represents many of the leading life insurance companies.

We are confident that we can provide answers to all of your life insurance questions. Our team is dedicated to ensuring that you find the right coverage for you and your family.

Contact our office today at (520) 836-3244 to begin your search for life insurance for 50 and over.

Many Americans receive health insurance through a government entity or platform. This is true for younger individuals who may be looking to healthcare.gov or older individuals that rely on Medicare programs for their health benefits.

Scammers know this. They use the information to form clever and even threatening scam tactics to try and steal the personal information of countless individuals. Unfortunately, many are quite successful. This leads to a cost of $68 billion lost to scams each year.

As such, it is important to know the signs of a scammer before you interact with one. Not only will this save you from identity theft, the information can help you educate countless others. Keep reading for 8 red flags of health insurance scams.

1. You Are Asked Upfront For Money

A common tactic involves scammers pretending to be insurance agents. Commonly, they will say that they can get you a better plan rate or higher discount, but you will have to pay them first to render this service.

Simply put, government entities and insurance companies alike do not function this way. Never give your financial information or personal information to individuals like this.

2. They are Trying to Sell a Specific Plan

Similar to the point above, insurance agents and government entities alike don’t work this way. Agents and government aids do not have a preference to sell you one plan over the other, rather, they want to find the best plan for your needs.

If you find an individual pushing a hard sell on one specific type of plan, it’s a red flag that the caller is illegitimate.

3. They Can’t (or Won’t) Answer Simple Questions

When someone is hired as part of an insurance agency, they know all about the plans up for offer. This is how they help connect you with the plan that best fits your needs. When you are dealing with a caller who either can’t, or won’t, answer very simple questions about their policy offerings, the only policy they are offering is a scam.

4. They Say They Work With The Government

Whether it’s for healthcare or for your taxes, a federal government agency will never call you and never ask for your personal information such as your name, address, social security number, and bank information.

However, we understand that this particular scam makes many individuals nervous for risk of missing something important. In these cases, it’s best to hang up on the caller and contact the government body directly to verify the origin or purpose of the call.

5. They Claim You Need to Update Your Insurance Card

Healthcare reform is a big headliner anytime a new bill is circulating in congress. As such, when there is healthcare legislation happening, the uptick in scams starts happening fast. This is because a scammer will try to exploit your uncertainties by blaming reform on the need to collect your information.

Like in the point above, the government will never call and ask for your information. If you are worried however, you can always contact the government agency directly to verify the origins of the call.

6. The Offer is Too Good To Be True

Oftentimes scammers will offer you plans and discounts that are far too good to be true, especially when compared to the general average of plans from open enrollment. In cases like these, scammers may be offering you “insurance” that only amounts to a medical discount card at best, and an entirely fake plan at worst.

Depending on when you find out about the dupe, it may be too late to enroll in another plan.

7. You receive a Phishing Email

Phishing emails might be difficult to spot at first as they are made to look as legitimate as possible. However, even the best scammers can’t make a fake email look real.

Red flags to look out for include an email coming from an incorrect or unknown address, spontaneous requests for information, or links which direct you to financial forms. These warning signs usually indicate the email is a scam.

8. You are Being Threatened

Some scammers go the aggressive route and attempt to harass and threaten other individuals into divulging their credit card, banking, and personal information. Know that, like asking for personal information, you will never be threatened over the phone by a legitimate government entity.

Resources for Reporting

In the event that you suspect a scammer, there are several reporting agencies available to help keep yourself and others safe. The following is a list of agencies that allow you to report scams, fraud, and file formal complaints.

• Medicare Fraud
• State Insurance Fraud Bureau
• National Health Care Anti-Fraud Association
• ftc.gov/complaint

Working With Trusted Arizona Agents

One surefire way to avoid a scam isto work with an agency that boasts years of experience on the local and state-level.

A staple in Casa Grande Arizona, the Gebhardt Insurance Group offers a variety of coverage from a host of major insurance carriers with an experienced staff that can help you determine the right coverage for your business. Give us a call at 520-836-3244 to get a quote and make an appointment to take the final steps in insuring your business.

Any time family members depend on your livelihood and services for their daily needs, life insurance becomes an important part of your financial planning. In the event of your death, expected or otherwise, your policy coverage is the difference between your loved ones being financially protected or buried in grief and debt.

From this perspective, the decision to get life insurance seems rather simple. Unfortunately, many individuals delay getting coverage far longer than they should, creating an avoidable risk for those they love.

Below, we discuss the different types of life insurance you can purchase and the different life milestones that indicate it is time to enroll in a plan.

Types of Life Insurance

Life insurance is not a one-size-fits-all solution to financial security. Depending on your health and the stage you are at in life, some policies may hold more appeal than others.

Term Life Insurance

The simplest form of life insurance by far is a term policy. This is a bare-bones, no-strings-attached plan that offers a set term of coverage (30 years, for example) in exchange for a premium. If you pass away before this term is up, your spouse, family, or beneficiary will receive a death benefit— a sum of money paid on your passing to cover expenses, repay outstanding loans, and ensure the financial security of your loved ones.

Whole Life Insurance

Similar to term life insurance, “whole” policies also offer a death benefit in exchange for a premium. However, in comparison these premiums are far higher for the same amount in death benefit due to the different overall structure of these plans.

When purchasing whole life insurance, there is no term limit. So long as you pay your premium, you will have coverage for the remainder of your life.

Furthermore, “whole” policies have a cash value that earns a set interest rate over time. This is possible as part of your elevated premium cost goes to funding this value, essentially acting as a tax-deferred savings account that is attached to your policy.

Universal Life Insurance

Building on the policies above, we have Universal insurance. As the others, they function off the same premise but have slightly different policy structures.

For a universal policy, you have more control over your premium and death benefit by being allowed to alter these amounts at any time. Because your premium goes toward both the death benefit and the cash value of your plan, by lowering these thresholds you can readjust your premium to be far lower than before.

Here, the cash value also works a bit differently. Unlike whole plans which accrue interest at a fixed rate, Universal plans will accrue interest that fluctuates along with market pricing.

The above three policy types represent the most common life insurance options for most individuals, however, there are many more policies than what we have described here. With policies such as variable life insurance, variable universal insurance, simplified issue insurance, and even final expense insurance, individuals are recommended to speak with an insurance agent to pick the plan that meets their needs.

Knowing that such a variety of plans exists, it’s time to look at some of the major life events that should have you considering life insurance.

When Life Insurance is a Necessity

Discussed previously, life insurance is a way to give financial security to those who rely on you for their daily quality of life. This includes having a large enough death benefit to cover expenses, outstanding loans, and potential funeral costs.

As you will see, many of these events are those which happen earlier in adulthood. This serves to debunk the rather harmful myth that life insurance is reserved for the elderly. Not only can life’s unpredictability leave our loved ones in a challenging situation if we pass prematurely, it is universally cheaper to begin coverage when young and healthy.

Some telltale milestones are listed below:

1. You are married or own assets with a spouse 

For most individuals sharing a life with their spouse, financial security rests in the balance of both partners shouldering some of the burden. Should one spouse die unexpectedly, this would create financial hardship in maintaining assets, repaying loans, and a host of other expenses normally shared between two earning individuals.

Here, it is recommended that your policy death benefit covers any existing balances on loans and other major expenses. This is especially true for private student loans, most of which are not dischargeable after death. If your death benefit fails to cover your outstanding loan amount, your partner will be responsible for paying the balance.

2. You are the breadwinner of your household

In single-income households or households where the lifestyle of one partner is largely dependent on the increase in earning capacity of the other, you will similarly want to buy a life insurance policy. In the case of your unexpected death, your benefit should help cover your personal finances and any outstanding loans such as those for vehicles and education.

For individuals in this situation, Term life insurance is a highly recommended policy type, given that your policy term limit will cover your working years.

3. You have minor children

As an addition to the above, you want to ensure that if you have children, you also have life insurance. This allows for your remaining spouse or guardian to meet the financial obligations left behind while still providing adequate financial support to your children’s day-to-day life.

As with calculating the worth of a stay-at-home parent, you need to be honest and exact when calculating the costs of your children, potentially even adding expenses such as college tuition. This will help you arrive at a more accurate number for your ideal death benefit amount.

4. You are a stay at home parent

While the stigma of being a stay-at-home parent is lifting as the years go on, there is still some confusion as to how life insurance benefits as a spouse who does not earn an income in a traditional job.

The recommendation here is to compile the costs that would accumulate should you have to pay for the services this partner provides. This includes housekeeping, child care, meal preparation, school help, and more. According to Salary.com, the worth of a stay-at-home parent is upwards of 162,000 annually, giving more than enough reason to purchase insurance should something unexpected arise.

5. You Have disabled adult children or support aging parents

Similar to minor children, a disabled adult child or family elder often does not have the capacity to support themselves. As such, if you are a part of contributing to their daily expenses, getting insurance that can maintain that support in your absence is integral to their quality of life.

In these cases, life insurance can help cover their immediate needs, but it is also wise to speak with an estate planning attorney to ensure your family has secure, long-term care.

6. You own a business that employs other individuals

Similar to how a buy-sell agreement ensures a company has a plan of action should a business partner pass away, life insurance can provide an added benefit to the financial stability of the company when placed under the same circumstances.

Many small business owners fund their start-up process with a series of loans, some of which they use personal assets as collateral. Furthermore, their business is a reliable source of income for their employers. Because of these two factors, having a life insurance policy that can repay your loans and maintain employee payroll for a set period of time is integral to being a responsible business owner and planning ahead.

7. Your job is high risk

A high risk job means your chances of becoming fatally injured are far higher than normal. If you are in this category, life insurance is integral to the financial health of your family, even if your premiums reflect a higher price.

Shop Local: Insurance Agents in Casa Grande, AZ

The above instances are only a handful of examples where an individual may need life insurance. However, as a rule, if anyone depends on you financially, no matter your age, life insurance is heavily recommended. Even though it may be a challenging thought to engage with, it’s the responsible decision to make.

At Gebhardt Insurance Group, we understand the different policies of several life insurance companies. As experts in the field, we can help you understand the various benefits and offers made by different plan providers, all in a way that is concise and simple, helping cut down on time, misunderstanding, and potential mistakes in coverage.

Ready to speak with an insurance experiment about the plan that’s right for you? Give us at call at 520-836-3244.

As we enter into another recession, US residents are searching for alternatives to employer-sponsored healthcare.

Why? With skyrocketing unemployment rates and an uncertain job market, short term plans (also known as “term health insurance plans”), may be the only affordable option to bridge the gap experienced in coverage.

Unfortunately, there is no easy way to find the short term plan that works for you. Each insurance provider has their own requirements, limitations regarding coverage, and plan details.

As such, the information below is a starting point to explain some of the most common routes insurance providers take when developing short term insurance plans, in addition to some of the unexpected consequences consumers face when failing to read the fine print.

What is Short Term Health Insurance?

Many major insurance companies offer plans that offer health insurance coverage. In the state of Arizona, these policies are offered up to 364 days at a time. This gives you the opportunity to re-enroll after your current plan has expired, or, simply end your coverage period and allow employer-sponsored benefits or Medicare to kick in.

As these plans are open for enrollment at any time (with some offering coverage as soon as the next day), they provide a flexible option to remain insured if you have missed the open enrollment period for the Affordable Care Act.

What Does Short Term Coverage Actually Cover?

Generally, these policies seek to provide coverage for individuals against major medical events such as unexpected illness or accidents. However, several policies also include provisions for prescription drugs, preventative care, and maternity care.

Pitfalls of Short-Term Plans

While these plans are flexible, inexpensive, and allow you to keep your current medical providers, they are riddled with unexpected problems.

They Are Often Not ACA Compliant

any short term health plans are not compliant with the Affordable Care Act (ACA) and therefore do not provide the “10 essential health benefits” designated by this program:

1. Hospitalization 
2. Ambulatory services
3. Emergency services
4. Lad services
5. Mental Health and Substance Care
6. Rehabilitation 
7. Prescription medicine 
8. Maternity and Newborn Care
9. Pediatric services
10. Preventative and wellness care

As such, you are never guaranteed minimum essential coverage by short-term plans and can, in the future, find out that your policy covered far less than you originally expected.

You Might Face Balance Billing

The flexibility of short-term plans comes from the fact that they don’t have a “network.” Without a network, there is no set or established list of health care providers who you know will accept your insurance policy. As such, you might visit a doctor only to find out later that they do not accept your insurance, thus resulting in a medical bill that must be paid for mostly out of pocket.

No Coverage for Pre-Existing Conditions

One of the largest differences between short and long-term insurance plans is how they cover pre-existing conditions. Short-term plans are meant as a backup for medical problems that have not yet happened, they are not made to cover a condition you are already aware of.

Here, some insurance providers will trust your portrayal of your previous health conditions until you file a claim while others will not. In either case, verifying your health status requires an underwriting process in which up to 5 years of your past medical records can be used to determine your status. If they find you do, in fact, suffer from pre-existing conditions, this is grounds to deny you coverage.

Navigating Insurance Providers

As you may have gathered, insurers have a great deal of autonomy when it comes to what they offer as part of their temporary plans. Because of this, it is often necessary to check in with individual insurance providers to get information on what they cover. In the state of Arizona, the following providers are offering temporary coverage:

1. Blue Cross Blue Shield of Arizona (in partnership with IHC)
2. Everest Prime
3. Golden Rule (UnitedHealthcare)
4. Independence American Insurance Company
5. LifeShield
6. Madison National
7. National General
8. Philadelphia American Life Insurance
9. Standard Life
10. Companion Life
11. United Security Health and Casualty

While these are the current providers offering plans in Arizona, this information is subject to change. For the most up to date information, it’s best to check in with the insurance providers themselves to see whether they are still offering coverage.

Some Insurance is Better Than No Insurance

When it comes to your health, having sub-par insurance for a period of time is almost always better than having no insurance at all. However, it’s important to think in the long-term and start shopping for a plan that is sustainable enough to maintain on a regular basis.

At the Gebhardt Insurance Group, we offer a variety of coverage from a host of major insurance carriers with an experienced staff that can help you determine the coverage you need. We can help everyone from individuals looking for a basic health policy to families, persons with pre-existing conditions, and even those who are looking to purchase life insurance.

If you have any questions, give us a call at 520-836-3244 to get a quote and make an appointment to take the final steps in insuring your business.

What is life insurance? It is an insurance contract that is established between the policyholder and the insurer that will pay a benefit upon death. There are various types of life insurance products on the market today. One type of life insurance is called permanent life insurance. Permanent life insurance pays a death benefit to the named beneficiaries and can be a great investment. 

Facts Regarding Life Insurance

According to a study by LIMRA titled “Life Insurance Ownership in Focus” more than 87 million Americans have a life insurance policy. The number of Americans that have life insurance is trending upward; however, the average amount of coverage has decreased. Approximately 70% of U.S. households have life insurance.

The Difference Between Term and Permanent Life Insurance

Term life insurance is much simpler than permanent or whole life insurance policies. The buyer agrees to make premium payments for a specific term or period. These policies are commonly purchased for terms of 10, 20, or 30 years. Term policies are fairly affordable and are most popular among households that have dependent children.

Term policies pay a specified death benefit if the insured party dies during the term of the policy. Buyers often choose a term based on when certain milestones are likely to occur. For example, parents may choose a term policy that extends to the estimated time their children will be graduating from college. A term policy can be very important so that dependent loved ones have financial support if you pass away.

A permanent life insurance policy also pays an amount to the beneficiary when the insured party dies. There is no other defined term or length for a permanent life policy. A whole life policy typically has a fixed premium amount. These types of policies often contain clauses preventing an insurer from revoking or otherwise terminating the policy unless premiums go unpaid.

Permanent life policies also have a savings component that builds cash value that the policyholder may borrow or withdraw from. As funds accumulate, they are invested in a tax-protected account. The investment portion of the policy may be subject to stock market fluctuations and the invested funds may generate dividends. Common types of permanent life policies include variable and universal life insurance.

Why Purchase Permanent Life Insurance?

Each consumer has a unique set of individual circumstances. Life insurance policies are fortunately not a “one size fits all” product. Many lower-income individuals immediately recognize that permanent policy premiums are beyond their financial means. These policies tend to be more expensive than term policies.

It is critical that consumers considering a whole life policy are prepared to maintain it. Those with a need for a life policy that exceeds 30 years often find it difficult to find a term policy. Those with a considerably younger spouse who want to ensure that they will have financial support should seek a permanent life policy. Children with permanent disabilities should also be considered when choosing a life insurance policy.

Variable Life Insurance

Variable life is a type of permanent life policy where the cash value and death benefit fluctuate based on the performance of invested funds. When the investments perform well, the earnings may be used to pay premiums or added to the death benefit amount. Variable policies may or may not have a guaranteed return rate. Keep in mind that the cash value may decline in years where investments perform poorly.

Universal Life Insurance

A universal life policy is a type of permanent policy that invests funds. The key aspect that differentiates universal policies is that they generally have a fixed rate of interest. The policies are quite flexible. The policyholder may choose to skip premium payments as long as the minimum required premium is paid during that year. Policyholder’s may have the option to tailor the amount of premium allocated toward the death benefit or cash value.

Indexed Universal Life Insurance

An indexed universal life policy allows the policyholder to maintain cash value in a “fixed account or equity index account.” The investment component is considered to be less risky than variable universal policies. The policyholder can typically pay a premium between a set minimum and maximum range. The cash value of the policy is usually accessible at any time without penalties.

Tax Benefits of Permanent Life Insurance

• The cash value of a policy will increase tax-deferred as a retirement account would.
• Withdraws from the cash value will usually be tax-free up to the amount you have already paid in premiums.
• Life insurance policy beneficiaries can receive the death benefit without having to pay taxes.
• Life insurance policy premiums are typically paid with “after-tax” dollars. 

Medical Examination Requirements

A life insurance company often will have applicants undergo a medical examination performed by a professional. You may be asked to complete a questionnaire. A full medical exam may include taking blood or urine samples and other various tests. This is part of the underwriting process that insurers complete when issuing policies.

There are “guaranteed acceptance” life policies available in the market as well. The premiums tend to be comparatively expensive and the death benefit may be restricted to a low amount. These policies are often viewed as being a poor overall value except for those with serious medical conditions.

Policy Waiting Periods

Some policies may have a waiting period. This is an amount of time that must elapse before the policyholder is eligible for the full benefits of coverage. These are commonly referred to as “elimination periods” or “qualification periods” during which you are paying premiums. For example, consider a policy with a two-year waiting period. If the policyholder dies during that time they may only be able to recover the amount already paid in premiums.

Comparing Life Insurance to Other Types of Investments

A permanent life policy is not the best option to choose exclusively for investment purposes. Although there are clear tax advantages, life insurance does not offer an employer match like a 401(k) or other retirement accounts. Those who qualify for Roth IRA’s may find these to be a superior option for investment purposes. It is recommended that you always consult a financial advisor or other professional.

Advantages to Purchasing Insurance Through an Independent Agency

If you have shopped around for insurance recently you have likely encountered an overwhelming number of options. Trying to compare policy options can be time-consuming. Unlike a captive insurance agent, an independent agent can offer policies from various insurance companies. These professionals are positioned to efficiently evaluate and identify the best options for your unique set of circumstances and goals.

Independent Agency Provides Life Insurance in Casa Grande

The Gebhardt Insurance Group is a well-established provider of insurance solutions and is locally based. We can help you save money on insuring your home, vehicles, business, and much more. Contact our team of professionals today at (520) 836-3244.

It should come as no surprise that the costs of life insurance typically increase with age. Seniors should expect fewer coverage options and higher monthly premium prices. Life insurance companies view those ages 60 and over as a much greater risk. What are the best life insurance plans for people age 65 and over? The answer varies according to your individual circumstances and what benefits you are seeking.

What is Life Insurance?

A life insurance policy is a contractual agreement between the holder of the policy and an insurer. The insured makes premium payments in exchange for some lump sum death benefit payable to the beneficiary named by the deceased. There are dozens of types of life insurance policies. Term and permanent are the two primary types of life coverage.

Life Insurance Considerations

There are a host of considerations that seniors may factor into their policy selection as follows:

• Whether there is a living spouse or not
• Other assets that the individual has such as a home, retirement account(s), etc.
• Any current debt and the amount(s) owed
• If any children are still dependent financially
• Any estate taxes that would apply upon death
• Whether elderly parents or adult children who are disabled are relying on support financially       

Term Life vs Whole (Permanent) Life Insurance

A term life policy lasts for a specified time period of up to 30 years. Compared to whole life insurance, it may be seen as a temporary policy. Term policies are generally more affordable. The insurer may not ultimately have to pay a death benefit if the insured outlives the policy term.

A whole (permanent) life insurance policy remains in effect as long as the premium is paid and usually builds cash value. The insured party may use this cash according to the terms of the contract. These are typically much more costly than term policies.

Annual Premium for	$500,000, 10-Year	Term Policy	(Healthy/	Non-Smoker)
	Age 40	Age 50	Age 60	Age 70
Male	$242	$547	$1,476	$4,523
Fe,ale	$211	$449	$986	$2,807

The above chart shows the large disparity in prices based on gender. Premiums for females ranged from roughly 13% to 38% less costly.

Age Limitations on Life Insurance Products

As you advance in age, there are fewer options available for term policies. These age-related limitations vary by company. Generally, the maximum term available for those 70 years of age is 20 years. At ages 75 and 80, the maximum terms decline to 15 and 10 years. Whole life policies for this age range are quite costly and are rarely offered beyond age 75. Seniors are also likely to encounter a requirement that they submit to a medical examination.

Concerns Regarding Medical Conditions

Seniors in their early 60s who are in good health may qualify for a term policy with a monthly premium of roughly $100. Being in good health allows access to better rates. This is partly due to the chance that the policyholder will live beyond the term of the policy. These healthy individuals may find that submitting to a medical exam lowers their rates.

MetLife typically requires applicants over the age of 50 to submit to an electrocardiogram and both blood and urine tests. New York Life often requires those over the age of 70 to undergo cognitive and physical testing. Prudential Insurance may reference a database showing any prescription drugs applicants take.

Avoid Buying Cash Value Policies Over Age 65

Universal life insurance policies are a form of whole life policies that accumulate cash. Policyholders can obtain a loan from their policy while still alive. These types of policies are generally not recommended for seniors. The premium tends to be high due to the cash value feature of these policies. In addition, they tend to have administrative or management fees that can approach 3%. The policies are often best for those focused on longer-term goals.

Burial or Final Expense Policies

Those well into their 70s will likely have few options. Those over 80 years of age may only be eligible for a burial policy. Burial insurance is a form of whole life coverage that exclusively pays “final” expenses. The death benefit in the policy is unlikely to exceed $40,000, with many in the $10,000 to $15,000 range. Typically they do not require a thorough medical exam. These policies are useful for seniors with health concerns who want ensure their family does not have to pay for funeral expenses.

Evaluating the Insurance Carrier

You may recall seeing advertisements, such as those with celebrity spokesmen, discussing life insurance policies with “guaranteed” acceptance. They commonly promote that no medical exam is required. The insurer knows that these policies are particularly appealing to those with health concerns. As a result, the policy premium is typically inflated and death benefits are generally limited.

You should feel comfortable that a life insurance company is stable and legitimate before purchasing a policy. It is often advisable to check their Standard and Poor rating or AM Best standing. Avoid purchasing policies that have extremely confusing terms and conditions. You should have a firm understanding of what the agreement entails.

The Advantage of Purchasing Through an Independent Agent

There are many types of life insurance products on the market from many carriers. A smart way to consider your options is by consulting with an independent agent. These insurance professionals are able to identify your needs and find policies that are suitable. An independent agent is not “captive”, meaning that they may offer policies from more than one carrier. This allows seniors more life insurance options and will help with finding an affordable solution.

Life Insurance Agency in Casa Grande

Our team of insurance professionals at the Gebhardt Insurance Group has provided life insurance to those of all ages for years. We also assist those locally with auto, homeowners, business insurance and much more. We encourage you to contact us today at (520) 836-5244.