A Unique Solution for the Cost of Life Insurance

//A Unique Solution for the Cost of Life Insurance

A Unique Solution for the Cost of Life Insurance

For Mark Roberts’ Use: As financial advisors, we often hear of individuals who allowed their term life insurance contracts to expire. Twenty or so years after selecting the policy, replacing it with a permanent life insurance plan might require a premium increase that feels uncomfortable.

But going without life insurance is an enormous risk of its own. Even if your children are grown, you might still have a spouse, debts that you would prefer to be covered, and of course, burial expenses. So you would probably prefer to maintain at least some form of life insurance protection.

Survivorship life insurance presents a unique solution for couples, and sometimes even business partners. The insurance policy covers the lives of both parties, with a death benefit paid only after the second individual passes away. Since premiums are based upon the lives of two people, with only one death benefit eventually paid, the rates can often be more affordable than a permanent life insurance policy for one person.

Occasionally, you or your spouse might be rejected for life insurance coverage as an individual. With survivorship life insurance, you might be able to obtain coverage together.

Since death benefits are paid only after you both pass away, survivorship life insurance is often best for couples who have adequate income in the event that one outlives the other. The eventual benefit can be used to cover any debts left behind, burial expenses, and leave a legacy for your heir(s).

Since a portion of the premium might go into a cash-value account (depending on the structure of the policy selected), it is sometimes possible to withdraw the cash value after the death of the first party. Of course, this does reduce the final death benefit, but the cash value portion of the policy might offer you additional security and peace of mind.

For more information on survivorship life insurance, how it works, and potential tax benefits or drawbacks, let’s discuss the issue at our next meeting. We can help you understand how this unique type of life insurance works, and decide whether it might be a good fit for you and your spouse.

By |2018-12-17T17:51:49+00:00December 17th, 2018|Financial tips|0 Comments

About the Author:

In addition to managing clients’ money and giving investment and diversification advice, Mark offers something that “the other guys” don’t - a unique approach to Retirement Tax Strategies and distribution. Time and time again, Mark meets with new clients who tell him they have a great relationship with their financial advisor but have never been offered information on this kind of approach to securing their financial futures. Mark has taken this feedback to heart and works tirelessly to ensure that his strategies focus on taxes and distribution. Mark started selling insurance for a major insurance company right out of high school to help put himself through college. After graduating with a degree in finance, he dove into estate planning on the financial side to set himself apart from other financial advisors. However, as changes were made to estate tax laws over time, Mark shifted his focus to income tax strategies. Mark’s philosophy is “the blue prints are more important than the wall paper or carpet.” The wall paper and carpet represent products like investments and insurance policies, whereas the blue prints represent the strategies. Once strategies that truly fit the client’s needs are put in place, our focus can shift to providing you with the right products. According to Mark, “It doesn’t matter what carpet we use if the walls are not in the right place.” Our approach to money management is designed to generate the largest alpha (quality) with the lowest standard deviation and beta (risk). By doing this, we help provide clients with the highest return on the lowest risk. Generating income for our retirees is also very important. Because withdrawing money from your portfolio hurts the account rather than helping it, our goal is to design income strategies to harm the portfolio the least making the money last longer.