Life Insurance 101

Why Life Insurance

Life insurance is there to help your loved ones with financial needs if you aren’t there anymore. Consider your mortgage and other debts, how much income would need to be replaced, money to cover a funeral, and college for the kids. Add those up, and you’ll have a good idea of how much insurance you’ll need. 

Buying life insurance protects your spouse and children from the potentially devastating financial losses that could result if something happened to you. It provides financial security, helps to pay off debts, helps to pay living expenses, and helps to pay any medical or final expenses.

How much life insurance coverage do I need?

There are many ways to calculate how much you need, but we commonly use two simple methods.

  1. Common Amounts – As a first step, many clients select a standard amount of life insurance such as $100k, $250k, $500k, $750k, or $1 million. We encourage this step as it is better than having nothing at all.
  2. Multiplier of Income – We recommend a minimum of 10 times your income for term life insurance, and $200k to $500k for a stay at home parent

Types of Life Insurance

Below we will review some of the most common life insurance options, including temporary and permanent life insurance.

Term Life Insurance

● Temporary coverage for a set number of years

● Death benefit with no cash value*

● Fixed Level premiums for the number of years selected (usually 10, 15, 20 or 30)

 ● Coverage ends when the selected term is over

Whole Life Insurance

● Permanent (lifetime) coverage 

● Potential for policy cash value accumulation 

● Fixed premiums that do not fluctuate over time 

● Ability to borrow against cash value

Universal Life Insurance

● Permanent (lifetime) coverage 

● Potential for policy cash value accumulation 

● Flexibility to change premium payments and death benefit amount (after policy is in force)

Financial Protection

Securing your future is a vital step and life insurance plays a crucial role in providing financial protection and peace of mind. As you navigate the complexities of choosing the right coverage, remember that investing in life insurance is an investment in the well-being of your loved ones. Whether you’re safeguarding against unforeseen circumstances, planning for your family’s future, or ensuring a legacy, the right life insurance policy can make a significant difference. Take the time to assess your needs, explore options, and consult with a life insurance professionals to make an informed decision that aligns with your goals.

The Best Life Insurance

The best type of life insurance is whatever coverage is in place when you pass. Having any type of life insurance policy in place is what matters. If you are ready to look at some options, please complete our webform for a life insurance proposal and someone will be in touch.

Request Your Proposal Here

Are you ready to save time, aggravation, and money? The team at Dumbaugh Insurance is here and ready to make the process as painless as possible. We look forward to meeting you!

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