Life insurance is a contract between an insurer and a policyholder. It’s meant to provide financial coverage to the policyholder’s beneficiaries in case of death. The policyholder pays premiums to keep the policy active. Then, it’s up to the life insurance company to pay out the death benefit if a claim is made.
Life insurance provides financial protection, security, and incredible peace of mind for individuals and their families in the event of the insured person’s death. Determining the amount of coverage you need can be confusing, but that’s what we’re here for. Your HCP agent can guide you through the key questions and help you find the right amount of coverage and type of policy that fits your needs.
Life insurance fundamentals
A life insurance policy protects your family and others who depend on you for financial support. It provides a payout to your beneficiaries after your death to help cover funeral expenses, pay off your mortgage, replace your income, and provide college tuition for your kids. Life insurance can also play a role in building wealth and investments.
What is life insurance?
Life insurance is a type of financial protection that provides a payout to beneficiaries upon the death of the insured person. This coverage offers peace of mind, knowing that loved ones will be financially secure during a difficult time. Most people choose one of three common policies.
Term life insurance
Term life insurance provides coverage for a set period, usually 10 to 30 years. If the insured person dies during the policy term, a death benefit is paid to the beneficiaries. It is commonly used to cover specific financial obligations like mortgages or education expenses. Term life insurance offers affordable premiums and simple coverage.
Whole life insurance
Whole life insurance provides lifelong coverage and includes a cash value component that grows over time. A portion of the premium contributes to the cash value, which can be accessed during the insured person’s lifetime through loans or withdrawals. It offers permanent coverage and can be utilized for estate planning, wealth transfer, or covering final expenses.
Universal life insurance
Universal life insurance is a flexible form of permanent life insurance. It combines a death benefit with a cash value component that earns interest based on market performance.
Policyholders can adjust premiums and death benefits to suit their changing financial needs. Universal life insurance offers potential cash value growth and can be used for estate planning, charitable giving, or building wealth.
Types of life insurance coverage
While term life and whole life are the two most common types of life insurance, there are several others, and your policy will vary depending on the one you pick.
- burial and funeral insurance policies
- credit life insurance policies
- mortgage life insurance policies
- supplemental insurance policies
- universal life insurance policies
- variable life insurance policies
- survivorship life insurance or joint life insurance policies
What does a life insurance policy cover?
While the specific things your policy covers may vary, there are two things you can expect from every life insurance policy: a premium and a death benefit.
Life insurance premiums are the monthly or annual payments the policyholder makes to keep their life insurance policy active. Their cost can vary significantly depending on age, existing health conditions, and the type of coverage.
Your death benefit is the amount paid out to your beneficiaries in the event of your death. It’s important to consider both the premium and the death benefit carefully before you land on a life insurance policy.
Frequently asked questions about life insurance
Your primary options for life insurance include term life, whole life, and universal life. You may also want to consider purchasing additional riders or coverages to customize your policy further. We would love to help you explore these options when you contact HCP for a consultation.
Policy premiums depend on various factors, including the type of policy and coverage amount purchased. So, what’s the best way to get an accurate quote? Speaking with an experienced life insurance agent!
Here’s how HCP Insurance can get you covered
In 6 simple steps, you can have all the assets you’ve worked hard to acquire fully protected.
- Fill out an intake form to give us an idea of your coverage needs
- If we have any questions, we’ll follow up
- We’ll start researching the best options for your custom policy
- Once our research is complete, we’ll share the best options for your individualized needs
- You ask our trusted advisors any questions about the policies you may have
- Once you make your decision, we’ll get your coverage started immediately
All of these steps can usually be taken care of the same business day you reach out. If it’s outside business hours, we’re going to jump on this as soon as we can. You’ll get an email confirmation right after Step 1 is complete — always.
Protections for your beneficiary
There is a wide range of options when it comes to all the different types of life insurance. Connect with HCP Insurance for help navigating the choices.