Life Insurance in Ypsilanti Michigan
Life insurance is a contract between a person (policyholder) and an insurance company, with the insurance company providing financial support for the policyholder’s beneficiaries (typically spouses or adult children) after their death. This is done with the policyholder making regular premium payments. During the time the policy is in effect, the insurance company agrees to pay a sum of money, called a death benefit, to the policyholder’s beneficiaries upon death.
There are no limitations as to how the money is to be used. Whether the policy is for $50,000, $500,000, or more than $1 million, the beneficiaries can use the death benefit however they choose. Most people use it to cover the deceased’s funeral costs as well as any outstanding debts, such as mortgage payments and credit card bills. Those with children may use the money for college expenses. The death benefit is usually paid in a tax-free lump sum.
Main Types of Life Insurance
There are two main types of life insurance:
- Term life insurance. This type of insurance provides protection for a certain period — typically 20-30 years. It is the cheaper of the two main life insurance options, and it has no cash value.
- Permanent life insurance. Whole life insurance or universal life insurance can provide lifetime coverage. These insurances have the ability to accumulate cash value, which can be accessed while you’re still living. However, the cost can be much higher than term life insurance.
What Does Life Insurance Cover?
Life insurance typically covers all causes of death, but there are a couple exceptions. Suicide is not generally covered in the first few years of an insurance policy. Homicide may also not be covered if the policyholder is murdered by a beneficiary.
Otherwise, all other causes of death are covered by a life insurance policy. They include
- An accident, such as a car crash
- Heart attack
- Illness
- Old age
- War
How Do I Choose?
Most people choose term life insurance because of its benefits. It’s a good option if you only need life insurance for a specific amount of time. An example would be to cover your working years as a possible income replacement for your family in the event of your death.
Term life insurance is also ideal for those with a limited budget. The rates will be lower, since it is not a cash value life insurance policy.
On the other hand, a permanent life insurance policy will last your entire life. It’s a good way to build cash value, but if that’s the main reason, you’re better off putting your money into a savings account. Discuss this type of policy with us for details.
However, keep in mind that as you get older, your life insurance needs may change. You may be able to convert to a permanent policy, although your options will depend on your policy and insurer. Contact Hartman Insurance today for solid advice.
Contact Our Ypsilanti Michigan Life Insurance Agency Today
When you need life insurance in Ypsilanti, get help from Hartman Insurance Agency. We know your life is in our hands, and we will do whatever we can to help you make the best decisions. Schedule a consultation today by filling out the online form or calling (734) 999-4190.