What is Life Insurance?
Incorporating life insurance in to your long-term plan helps provide peace of mind for those who depend on you. The primary benefit of life-insurance is what the industry calls a "death benefit" or a "face value" of which is guaranteed non-income taxable payment to your beneficiary (wife, children, business partner, etc.) at time of the policy holder's passing.
Life insurance has evolved over the years to serve more than just to provide a face value. Many living benefits are also supplied of which aim to establish a life insurance policy as a tangible asset that accumulates value of which can be utilized during the life of the policy.
There are many different types of life insurance policies with almost endless number of options and additional benefits that can be elected. Piedra Insurance Concepts is here to guide you through the advantages and type of policies that will work for you.
Universal Life
A Universal Life Policy is designed to provide coverage throughout the policy holder's lifetime and provides the same type of living benefits.
Unlike a traditional whole life policy, Universal life insurance offers flexible cash value based premiums. The policy holder pays premiums that immediately fund the cash value account of which generates interest in the insurance company's general account of which is used to fund the Cost of Insurance (protection - Death Benefit Fund) and Insurer's expenses (Admin costs/fees).
Cash values are not guaranteed but policies maintain a minimum interest rate of accumulation. Universal policies also allow for partial cash value withdrawals which reduces the death benefit but provides immediate liquidity if/when needed.
Indexed Universal Life (IUL)
Functions as a standard universal life policy with the key difference in that the cash value account credits interest to funds allocated to an indexed stock market strategy (such as the S&P 500 for example). Rate of returns in the cash value account fluctuate alongside the index market account's performance.
An indexed universal life policy is a unique financial vehicle such as compared to an IRA, 401k or Money Market investment account; An IUL guarantees a minimum rate of return regardless of the index's performance. There is no risk for loss, accumulations are tax deferred and cash value withdrawals treated as a first in/last out basis (your principal is pulled first which is not subject to income tax, any growth/accumulation is)
Quality Planning
How Much is Enough?
Piedra Insurance Concepts is your trusted advisor to help right-size your policy based on your personal circumstances. We strive to allocate a policy that fits into your overall life plan and objectives. We structure polices based on at a minimum:
- The composition of your family and the ages of the survivors
- Your family’s education plans
- Current debts and expenses
- Lump-Sum cash needs and income replacement needs vs. existing liquid assets and/or other sources of income (social security, dividends, retirement accounts)
- Likely future income requirements
- Existence of other income, both spousal earned income and unearned income
Application Processing
Depending on risk factors and type of policy chosen, many policies and applicants do not require medical exams. However, for those that do, Piedra Insurance Concepts will guide you through the application and underwriting process every step of the way.
Any and all physician exams, blood testing and/or urine testing is of no cost to you and can be utilized as part of your yearly health exam.
PIC will review triggering risk factors that insurers look out for and identify the most feasible pathway forward.