Life insurance In Ohio is available from most of the major life insurance companies. More than one hundred quality companies such as Prudential, Transamerica, MetLife and Genworth offer affordable policies. Term, whole life and universal/variable are the three major forms of insurance protection.
Term insurance is the simplest and least expensive form of life insurance. It provides the largest possible death benefit while spending the least amount of money. Death benefits are almost always tax-free to the beneficiary and you can select the length of time you need coverage.
Although term insurance in Ohio builds no cash value, the low premiums allow you to “invest the difference” in the appropriate investment of your choice. And hopefully, by the time your need for life insurance has substantially reduced, the money that you invested separately will have grown to an amount that far exceed your insurance needs.
Term insurance policies can guarantee a premium not to increase for a specified number of years. Normally, this period of time is between 5 and 30 years. If the need for coverage is short term, a period of 10 years or less is appropriate. If your health changes during the guarantee period, the rate will not increase.
However, at the end of the term, obtaining additional coverage may be very difficult. There are carriers that specialize in "high risk" cases, but avoiding this type of option is obviously preferred.
Whole Life Insurance
Whole Life insurance is a form of permanent coverage that you keep as long as you live and premiums are paid. Premiums are generally level and paid for life. Since premiums are level, it is less expensive to purchase whole life insurance coverage in your younger years.
Some Ohio whole life policies pay dividends that will allow you to suspend or skip premium payments. Cash value (some is guaranteed) accumulates tax-deferred, making this type of coverage better-suited for long term needs. You may also be able to borrow or withdraw some of the cash. When you choose to terminate the policy, you will also be eligible to keep any existing available cash.
Universal/Variable Life Insurance
Universal Life Insurance was created in the early 1980s as a more flexible version of whole life insurance. A portion of the cash accumulates tax-deferred, similar to whole life policies. Some of the remaining cash is used to maintain the death benefit. A guaranteed minimum interest rate (usually about 4%) is applied to the policy for protection against adverse investment return.
For an extra premium, some companies will guarantee the death benefit to age 100. But premiums must not be skipped or reduced, or the guarantee may no longer be valid. Universal life policies offer greater flexibility than most other types of life insurance. But as many Ohio customers have seen, policies can easily lapse or premiums can become extremely expensive if proper attention is not paid to the policy.
Life insurance should be an essential part of any financial plan. We'll help you determine the appropriate amount of insurance you should have and which company will meet your needs in the most affordable way.