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FAQ (frequently asked questions)

What is the best type of Life Insurance?

Regardless of what you may have read in financial advice columns, there is no “best” type of life insurance. What’s best is what’s best for you.

Life insurance is not a “one size fits all” product.

There is a wide range of permanent products to choose from, each with its own particular benefits, which can be tailored to suit your particular needs.

Term insurance may be right for younger people with limited means and financial responsibilities. It can also serve as a short-term means of pure protection. As life changes occur, the term policy can be converted to permanent insurance. You may find that a combination of permanent and term insurance is best for you.


How much life insurance should an individual own?

The industry standard for a quick calculation is an amount of 5 to 7 times annual earnings. However, many factors should be taken into consideration in determining a more precise estimate. Some of these factors include both earned and unearned income, a spouse’s earning capacity if the individual is married, the existence or absence of special life insurance needs like mortgage repayment, education fund, estate planning and others which enhance the need for life insurance.

How long do you need life insurance coverage?

Most would say they need the security of life insurance for their entire life. Life insurance can help pay off a mortgage, fund a college education, take care of final expenses, offset loss of income and allow a family to continue its standard of living. Both term and permanent insurance can provide those benefits, but which one can do it most efficiently over the course of a lifetime? With a permanent product like whole life, premiums are fixed – they can never be increased by the insurer; with term policies your premiums are set for a predetermined period (say 5, 10, 20 years) and then increase in subsequent years. With a premium increase at each renewal, the cumulative cost of term insurance over the course of several decades may well bypass that of a comparable permanent life plan.
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