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When people choose to purchase a life insurance policy in MD, it’s their loved ones they are most concerned about. In the event that something happens, and they are no longer there to provide for them, they want to leave knowing that their spouse and children will have something to fall back on and get them through a very difficult time. There is a certain peace of mind associated with the knowledge that there will be provisions in the form of a death benefit to their beneficiaries. It can also be a way for individuals to receive specific benefits while they’re still alive and well in order to benefit their families. Benefits available in the event of death Most policies will help pay many final expenses, debts, estate taxes, or any other outstanding financial debt. This way, beneficiaries won’t have to pay taxes on the death benefit amount. Benefits available while the insured is alive The increase that the policy accumulates in cash value over time will be tax deferred unless the money is withdrawn before maturity. In most instances the policy (as long as it’s a permanent life policy and not term life insurance) can be used to pay the down payment on a home, or go towards a child’s college tuition (barring any possible tax issues). How much life insurance is needed? This depends on the individual’s obligations (spouse and dependent children) and particular financial situation. This is something that needs to be reviewed with an agent. Life insurance can also help support aging or disabled parents, fund retirement needs of the insured or those of a spouse, or in executing certain aspects of a large estate. Optional plans are available Term Life Insurance, which is purchased for a specific period of time, is one option. This can also generally be converted to a permanent form of coverage should needs change over time. Then there is Whole Life, which provides coverage throughout the lifetime of the insured, as long as the premium is paid. With this type of policy, protection is provided, up to the policy’s face value, and cash value growth over time. And there is Universal Life Insurance, which is a type of permanent life insurance, and typically offers more flexible premiums than Whole Life. What’s more, typically there are varying face amounts and an unbundled pricing structure. This policy also builds cash value at an interest rate that’s guaranteed not to go below a level specified in the policy. Families should speak to an agent to determine which MD life insurance coverage might best work for them.
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