First and foremost, the decision has to be made, “How much should I buy?”
Industry experts say that you should own 10’xs your gross income. So, for example, if you earn $50,000 a year, you need a $500,000 plan. This is far too simple an approach. The better way to pick a death benefit amount equal to your family budget, indexed for inflation. So, if your salary and other sources of income are $100,000 per year, and over the next 20 years inflation is 3%, you would need $103,000 the second year, etc. So, run the numbers out for 20 or 30 years (the number of your prime working years whose income would have to be replaced in the event of your death.) to get a more accurate amount.
Should I buy term insurance, or cash value insurance? My advice is to decide what you can afford. Cash value life insurance is now indexed to the major markets, and the values are not set by the stingy board of directors of the insurance company. Over 20 or 30 years you can build cash value in excess of the selfish insurance executives who normally grant less than 3% a year. You should average 7%-9% over the next two or three decades, and that money, under current federal law, may be taken out of your plan on a tax free basis using the popular policy loan features. If, however, you can only afford a term policy, by all means, calculate the income you will be replacing over 20 or 30 years (depending upon how many working years you have left in your life) and buy that amount, allowing for changes in your plan as your life circumstances fluctuate.
Some life insurance carriers now will advance the death benefit in the event of critical illness. So you no longer have to “die” to receive a benefit. For example, if you suffer a heart attack, cancer, kidney failure, etc. the insurance company advances you all or part of the death benefit in tax free cash! This approach works well to pay essential bills while you are recovering from a serious illness, much like a long- term disability plan would, except you receive your cash all “up front.” Colorado Bankers Life is the leader in this type of coverage called Critical Illness Life Insurance.
Who are the major players in the insurance industry today? That question is fairly easy to answer by looking at the leaders. For term insurance, by far, West Coast Life  has the lowest and cheapest rates on the planet. If, however, you want the convenience of ordering totally online, check out GTL (Guarantee Trust Life) and order your term insurance with no agent or physical exam. For the cash value plans that are indexed to the markets, no one can beat Aviva USA. Industry studies have shown that Aviva, one of the strongest insurance companies on the planet, has the most generous cash value crediting method in the world. In fact, it holds a copy-write on the methodology, the first ever granted by the U.S. Patent office to a life insurance carrier. And remember, those cash values can be taken out on a tax free basis. So, if you can afford an index universal life plan, Aviva is the best. Otherwise, buy term, and deposit the difference in a Certificate of Annuity where your principal is guaranteed never to suffer a loss if you are at or near the age of retirement. SafeMoneyIsland.com is the place to be after your working years are over, and your goal is now to preserve, protect, and defend what you have earned over the years! Contact me for a FREE, NO OBLIGATION QUOTE designed to meet your needs.
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