Whether you just got married or are starting your family, choosing a life insurance plan is a necessity. It can ensure your loved ones are protected from your debt obligations and other financial strain in the event of your passing. Dewey Beckner, an agent with Allstate Insurance Companies, guides families in High Point, NC, through the process of choosing the right life insurance for their needs. He explains the differences between permanent and term life insurance so you can make an informed decision about your coverage.

What Is Permanent Life Insurance?

Unlike term life insurance, which is only in place for a set period, permanent life insurance plans offer you a lifetime of protection. Additionally, permanent life insurance policies accumulate a cash value. This accumulates on a tax-deferred basis and can be used for a variety of purposes.

You may wish to use your life insurance plan’s cash value for a down payment on a house or a fund for your children’s education. While this is an attractive feature of permanent insurance, keep in mind that borrowing from your plan’s cash value is like any other loan — the cash must be paid back with interest. However, the interest rates are often lower than you would find with loans from a traditional financial institution, and they are not dependent on your credit score or other factors.

Types of Permanent Life Insurance Plans

There are several different types of permanent life insurance plans, each with varying levels of risk:

• Whole Life: This type of plan is ideal if you prefer consistency, as it guarantees a specific amount of death benefits and rate of return for cash value. It features a steady premium that will not increase over time.
• Variable Life: With variable life, death benefits and cash values vary based on the performance of your underlying investments. This option involves greater risk but also has the potential for greater returns.
• Universal Life: A universal plan allows flexible premium payments, so you can pay more or less each month depending on your financial situation.
• Variable Universal Life: This option combines the universal and variable plans.

Dewey Beckner with Allstate Insurance Companies can guide you through the process of choosing a permanent life insurance plan, reviewing all your options so you can make an informed decision. Get an insurance quote online, or call (336) 884-5636 to schedule an appointment.