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The Different Types of Life Insurance

It is wise to make sure your family is financially protected in case you or your spouse die. However, there are various types of life insurance in the market, so it is vital to make sure you choose what is right for you and yours. The following includes various types of life insurance:

Term Life Insurance

This life insurance has an expiration date where it lasts for a certain number of years, but there will be no payout to your family if you or your spouse don’t die before the expiration date. 

Whole Life Insurance (Permanent)

This life insurance lasts for you or your spouse’s whole life and increases cash value as you keep up with the premiums.

Universal Life Insurance

This life insurance policy includes a cash value that goes toward the death benefit and the cash value. You also can change the amounts of the death benefit and premium without obtaining a new policy. 

Variable Life Insurance

With this life insurance, you are guaranteed a fixed death benefit and premiums regardless of the market trends. 

Simplified Issue Life Insurance

With this insurance, it is not required to take a medical exam. However, instant approval or rejection is determined through a few health questions that must be answered on online health questionnaires using data and algorithms for a quick application process. 

Guaranteed Issue Life Insurance

Just about anyone within an eligible age range, usually 40 to 85, can not be rejected and without needing a medical exam.

Group Life Insurance

Employers provide life insurance as part of the workplace benefits. Thus, the company’s workplace as a whole determines the premiums instead of each individually. 

Indexed Universal Life Insurance

According to a stock market index, this life insurance relates its cash value, and thus, a formula determines the gains. 

The different life insurance types mentioned above are common types of life insurance, and there are more important details about these types of life insurance. Other types of life insurance policies are available, including mortgage life insurance, fully underwritten life insurance, credit life insurance, accidental death and dismemberment insurance, and joint life insurance.

For more information about life insurance, contact Dalessandro Agency Inc. today. For 25 years now, Dalessandro Agency Inc. has locations in Kentwood, Charlotte, and other areas around Grand Rapids, MI. They have been providing outstanding service to people in Grand Rapids, MI and surrounding areas. Contact them today. 

An Introduction to Life Insurance

When you begin shopping for life insurance, you will find a plethora of terms specific to its policies. While there exist only two major types of life insurance – whole and term – more than ten policy types exist within those two categories. Here’s a short primer on the significant terms and policies.

Whole Life

This insurance policy provides a death benefit during your whole life so long as you pay the premiums. It also gets referred to as permanent insurance. Many of its policy types combine the death benefit with an investment fund component. 

Term Life

Juxtapose that with term life, which insures your life for a finite period, typically 10, 20, or 30 years. If you die within that time, so long as you have paid your premiums, your beneficiary will receive the death benefit.

Policy Types Within the Categories

Life insurance companies like Dalessandro Agency Inc. provide a vast number of choices. You can purchase more than one policy so that you can mix and match. Choose from the following:

  • universal life
  • variable life
  • variable universal life
  • survivorship life
  • increasing and decreasing term life

Whole life insurance policies like universal life, variable life, and variable universal life provide permanent insurance options. Each offers both a death benefit and a cash value account that lets you save money in a tax-deferred account. Universal policies invest this cash value in a money market account that earns or losses depending on the market performance. Variable life and variable universal life provide a death benefit and a cash value investment fund linked to a mutual fund with stock and bonds.

With term life, you only receive the death benefit. You show evidence of good health when purchasing the policy initially. You renew it year-to-year, but do not need to renew your proof of good health.

A survivorship life insurance policy covers more than one person. It typically pays out when the first person on the policy dies, but you can also obtain a joint and survivor policy, also known as a last to die policy. You can obtain these as a whole or a term policy.
A final expense or burial policy pays for the funeral and related expenses like the headstone and services. These small policies of about $10,000 of coverage can be permanent or term. Most life insurance policies require a medical exam, but you can find no exam policies.

A decreasing benefit policy proves popular with those who have a large mortgage to pay and want the family to be able to cover the payments. As time passes and the mortgage gets paid off, the policy benefit decreases until it reaches zero. At that time, the policy expires. An increasing benefit policy lets a young professional provide a more significant income for their family commensurate with their increased earnings.

Corporations often obtain key man life policies to protect the corporation from the effects of the loss of an executive officer, a superior salesperson, or a specialized skill player.

The variety of life insurance possibilities remains vast. Contact Dalessandro Agency Inc. of Grand Rapids, MI to learn more about your life insurance options and how we can help you provide for your family’s future now.