Life Insurance Facts & Figures
Life insurance provides financial protection in lieu of specified premium. It is a kind of insurance wherein life itself gets protected from the uncertainties and unexpected incidents in one's life.
- 95 million US adults don't have any life insurance at all (that's 41% of the population).
- 61% of men have some sort of life insurance coverage.
- 57% of women have some sort of life insurance coverage.
- Average behaviour. In percentage: 1) 93% of Americans say that life insurance is something most people need; 2) 50% of Americans admit they do not have adequate life insurance coverage; 3) 44% of Americans own an individually
purchased life insurance policy; 4) Many expert recommend at least 10 times your gross annual income in coverage.
- Average recommended vs. average owned. In dollars: 1) Average recommended life insurance coverage - $405.840; 2) Average amount owned - $166.800; 3) Average amount of insurance coverage on married men - $235.600;
4) Average amount of insurance coverage on married women - $147.800.
- Death causes: 1) Heart disease - 1 in 5 deaths; 2) Cancer - 1 in 7 deaths; 3) Stroke - 1 in 24 deaths; 4) Motor vehicle accident - 1 in 84 deaths; 5) Suicide - 1 in 119 deaths; 6) Falling - 1 in 218 deaths; 7) Firearm assault - 1 in
314 deaths; 8) Pedestrian accident - 1 in 626 deaths; 9) Drowning - 1 in 1.008 deaths; 10) Motorcycle accident - 1 in 1.020 deaths; 11) Fire or smoke - 1 in 1.114 deaths; 12) Bicycling accident - 1 in 4.919 deaths; 13) Air/space
accident - 1 in 5.051 deaths; 14) Accidental electrocution - 1 in 9.968 deaths; 15) Alcohol poisoning - 1 in 13.729 deaths; 16) Hornet, wasp, or bee sting - 1 in 56.789 deaths; 17) Legal execution - 1 in 62.468 deaths; 18) Lightning - 1
in 79.745 deaths; 19) Earthquake - 1 in 117.127 deaths; 20) Flood - 1 in 144.156 deaths; 21) Fireworks discharge - 1 in 340.733 deaths.
Life insurance - reasons & factors
- The major reason for purchasing life insurance is to guarantee the continued financial support of loved ones who depend on the insured in the event of the insured's death.
- Six reasons (you might need life insurance): 1) To replace one's ability to earn income; 2) To replace one's ability to care for others; 3) To pay for expenses arising as a result of death; 4) To provide for special business needs;
5) To fund a charitable interest; 6) To provide supplemental income later in life.
- Life insurance needs curve (life insurance needs (scale 1-10)): 1) Life begins - 1; 2) College/work - 3.5; 3) Marriage/first home - 6; 4) Peek earnings & asset accumulation - 10; 5) Children - 9; 6) Debt reduction - 9;
7) Grandchildren - 6; 8) Retirement & wealth transfer - 3.5; 9) Life ends - 1.
- Three attributes. Life insurance has three attributes: 1) The death benefit; 2) The premiums; 3) The span of years over which you pay the premiums.
- Six factors. In order to accurately estimate the amount of life insurance needed, here are some of the factors that must be considered: 1) The future expected income of the insured; 2) Existing debts; 3) Expected future spending,
including non-routine costs like college; 4) Future social security or pension benefits; 5) Likely costs associated with an individual's death, including estate taxes and funeral expenses; 6) Lifestyle changes that might be made by the
survivors in the event of the death of the insured.
Types of life insurance
- The two most common types of life insurance are: 1) Term life insurance: Provides coverage for a specific amount of time; It has a monetary value that is paid to the named beneficiary on the event that the policyholder dies; There
is a premium paid on the policy each year in order to keep it active; This form of insurance does not grow in cash value and is not used as investment; 2) Whole life insurance: Also considered "permanent" insurance; It is effect for
the life of the policyholder, as long as the premiums are paid when specified; It also pays on the value of the policy upon the death of the policyholder, this kind of insurance can grow in value over time.
- Main reasons to choose term life insurance: 1) Their main concerns is to cover the income earned during their working years; 2) The money saved for choosing term over whole life insurance could be put to better use during the
insured's lifetime; 3) Large face value for small premium payments.
- Main reasons to choose whole life insurance: 1) Using for inheritance; 2) Insurance coverage for life; 3) Installment or lump sum payments; 4) Convert to an annuity.
- Term life insurance & whole life insurance: 1) Term life insurance: Main purpose(s) - short-term financial liabilities; Cost - lower when initially purchased, increases with age based on term duration; Coverage duration - limited time,
generally for 5 to 30 years or 75-85 years old; Cash value - not applicable; Key advantage - typically offers the highest death benefit for the lowest cost; Whole life insurance: Main purpose(s) - long-term financial liabilities and cash
accumulation; Cost - Initially higher than term premiums, but often level for life; Coverage duration - lifetime, as long premiums are paid; Cash value - accumulates over time on a tax-deferred basis; Access to cash value - yes,
through loans and withdrawals; Key advantage - offers lifelong protection and tax-deferred savings.
* Certain limitations may apply to loans or withdrawals | Policy loans and withdrawals will reduce the benefit and cash values, and may be taxable under certain circumstances.
- Life insurance premiums (Keys: Term life insurance; Whole life insurance) (flowchart): Whole life insurance premiums remain the same for your "whole life".
- Life insurance comparison: 1) Death benefit: Term life -Yes; Whole life - Yes; Universal life - Yes; Variable universal life - Yes; 2) Flexible payment: Death benefit: Term life - No; Whole life - No; Universal life - Yes; Variable universal
life - Yes; 3) Invested in market: Term life - No; Whole life - No; Universal life - No; Variable universal life - Yes; 4) Cash value guaranteed: Term life - No; Whole life - Yes; Universal life - Yes; Variable universal life - No;
5) Tax advantages: Term life - Yes; Whole life - Yes; Universal life - Yes; Variable universal life - Yes; 6) Low monthly cost: Term life - No; Whole life - Yes; Universal life - Yes; Variable universal life - Yes.
- Which type of insurance is purchased depends on: 1) Needs; 2) Goals; 3) Finances of the purchaser.
Life insurance major influences
- Like any other insurance policy, you life insurance premium is determined by several criteria: 1) Major influences: Age; Physical/Health condition; 2) Some other influences: Occupation; Risky or hazardous sports; Gender; Lifestyle
(smoker/drugs); Type of policy.
- It never pays to fool the insurance company since these companies are expected to know their field and, if even a small amount of fraud is determined your claim may be denied when the time comes for your heirs to collect it.
Life insurance companies
- The list is long. Here are some of the most popular life insurance companies: 1) Assurity Life Insurance Company; 2) American General Life Companies; 3) Genworth Financial; 4) AXA; 5) AVIVA; 6) Banner Life; 7) Companion Life;
8) American National; 9) ING; 10) John Hancock; 11) Lincoln Financial Group.
No one life insurance product is better than the other. You have to determine what is best for you based on a wide variety of factors.
Courtesy of Whole Term Life Insurance Quotes | www.wholetermlifeinsurancequotes.org.