Permanent Life Insurance:

What is whole life insurance?

Whole life insurance is a type of permanent life insurance. That is, the coverage and possibly the premiums last for your entire life. As long as your premium payments are made as agreed, your insurance coverage lasts throughout your life, and the death benefit is a guaranteed amount. Your premium payments are a set, level amount that can't be increased. You can choose to make smaller premium payments throughout the life of the policy, larger payments over a shorter period (known as limited pay whole life), or lower premiums in the beginning and higher premiums afterward. In addition, dividends are typically paid on whole life contracts and can be used to either increase the death benefit or reduce the premiums.

When you pay the premiums on a whole life policy, part of each payment accumulates as a cash value. The insurance company typically invests the cash value, which continues to grow tax deferred as long as the policy is in force. You can borrow against the cash value, but unpaid policy loans and interest will be subtracted from your death benefit. You may also access your cash value by surrendering (canceling) the policy. However, if you do this, you'll be left without this insurance coverage.

Note: The cash value is only part of your premium payments. If you cancel your policy in the first 10 years, you will get back significantly less than your total premiums paid.

Like other types of cash value insurance, whole life is more expensive than term insurance during the early years of your life. But since whole life premiums neither increase as you get older nor are affected as your health deteriorates, it's often a more cost-effective solution if you need long-term insurance coverage. Investment returns on whole life insurance are typically lower than other types of permanent insurance, because the insurance company invests the cash value in extremely conservative vehicles, such as bond funds. If you are seeking greater investment returns or want more control over your cash value investment decisions, variable life or variable universal life may be a more appropriate choice.

How Traditional Whole Life Insurance Works

1. The premium you "pour in" is fixed for the life of the policy. As you age, the cost of insuring your life increases. However, your premium stays the same, because the company projects this expense in advance and factors it into the premium at the onset.
2. As you pay your premium, the insurance company deducts all of its expenses, premium taxes, and the cost of pure insurance (net amount of risk coverage), or mortality charge.
3. The remainder of your premium represents a portion of the insurance company's investment portfolio. Your cash value account is credited with a fixed amount (predetermined by your contract) at the end of each premium period.
4. Like water in a tank, the level of your cash value rises over time.
5. As the cash value increases, the amount of risk coverage (or pure insurance) in the policy decreases.
6. When you die, your beneficiary receives the "full tank" of the policy amount, which is the sum of the cash value and the pure insurance.
7. You may take a policy loan in an amount not to exceed the policy's cash surrender value less the annual loan interest. Repayment replenishes your cash value; any loan balance outstanding (plus interest due) at the time of your death would be deducted from the policy amount.

Suitability Statement - Documentation that satisfies the NASD rule that requires registered representatives to consider the customer’s financial status, tax status, investment objectives, and other appropriate information when making recommendations to the customer.

To buy Life Insurance, one need an Insurable Interest: Required to issue a life insurance policy: where a person would likely suffer a financial loss from the insured person’s death or can expect to benefit financially from the continued life of the insured person.

Human Life Value Approach - A method of calculating how much life insurance is needed; attempts to place a monetary value upon an individual’s earning power and use life insurance coverage to replace this loss to the individual’s survivors.

Multiple Of Income Approach - A method of calculating how much life insurance is needed; uses a multiple of between five and eight times an individual’s income

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Health Insurance Carrier List

Health Insurance
Aetna • Atantis Heath Plan • Cigna • Emblem health • GHI • Health Net Inc. • Health Advocate Inc. • HealthPass • HIP • Health Alliance • IRBA Plans • Oxford Health Plans • Perfect Health • United Health Care.

Partial Insurance Carrier List

Individual Disability
Berkshire • Principle • Mass Mutual • Union Central • Security Mututal Life Insurance of New York
Individual Long Term Care
Security Mutual Life Insurance of New York • Assurant • John Hancock Life • MedAmerica Insurance Company • MetLife • Prudential • Allianz
Individual Life
Security Mutual Life Insurance of New York • MetLife • Mass Mutual• William Penn Life • Banner Life Insurance Company • John Hancock • Bankers Life of New York • Jefferson Pilot Life • AIG • Prudential
Group Life • Group Disability
Aetna • Assurant Life • Guardian • Hartford • Jefferson Pilot • MetLife • Prudential • ING • Security Mutual Life Insurance of New York • SunLife • Unum • AIG • Cigna • Principal
Vision
1st Rehab • First Ameritas • Guardian • Davis Vision• Spectera • US Life Principle • VSP
Group Long Term Care
Aetna • Security Mutual Life Insurance of New York • Unum • Prudential
Dental
MetLife • Cigna • Delta Dental

Securities
First Clearing• Wells Fargo