What is Life Insurance?

What is Life Insurance?

The earliest known life insurance policy was written in London, England back in 1583. The first American Life insurance products can be traced back to the late colonial period. The Presbyterian Church set up the Corporate for Relief of Poor and Distressed Widows and Children of Presbyterian Ministers. Soon after insurance companies began offering life insurance to the public. By the mid 1800’s many mutual insurance companies organized providing life insurance to its members and distributed the profits back to the policy holders in the form of a dividend.

Generally, you need life insurance if other people depend on your income or if you have debt that will carry on after your death. However, the older you get, or if your health declines, the more expensive life insurance costs.

Seven reasons to buy life insurance.

1. Guaranteed Protection: If you have a family, a business, or others who depend on you, the life insurance benefit acts as a safety net. When you die your beneficiaries will receive a guaranteed lump sum payment.
2. Income Replacement: Helps make certain your loved ones can pay the mortgage, eliminate household debt, cover tuition, afford childcare, health care and preserve a family business.
3. Tax Free Benefit: Your beneficiaries will be able to enjoy every penny you leave them; life insurance is generally passed along free of federal and state income tax.
4. Maintain Family Lifestyle: Your loved ones will have the financial resources to maintain their standard of living.
5. Charitable Giving: Life Insurance can be a cost effective and convenient asset to give to the charity of your choice.
6. Estate Planning: Life Insurance, when designed correctly, can help reduce the estate tax burden at death.
7. Affordability: You may be surprised how affordable life insurance coverage can be for your family.

Many different types of life insurance policies exist to meet the varying requirements of the general population. Talk to one of our licensed insurance professionals to better understand what life insurance protection would best suit you.