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To get the best life insurance policy for your personal needs, you really need to be educated. Even during that process, you will never learn all there is to know. As I have used my life insurance policy (yes, I bought one that I can use before I die) I have learned so much more about how life insurance works. In fact, I just got off the phone with my life insurance company and wanted to share what I learned.
Life Benefits
The while life insurance policy I took out allow me to pay a reasonable monthly amount for a death benefit while accruing cash value. This is why it is a “life benefit” – I can borrow from the policy if I need money and I don’t really have to pay it back if I don’t want to. The reason is that the policy continues to grow and if I were to die, it would pay off the loan, then still pay out a death benefit.
Getting the Right Policy
If your insurance agent structures your life insurance policy properly, you may not need multiple policies. I got a life insurance policy that I knew I could add premium to at any time (up to a certain limit) to increase both the cash value and death benefit. What I didn’t know is that the amount rolls over every year to a max of $25,000. This means that if I am allowed to buy an additional $3,000 per year in premium but I don’t exercise that right for 5 years, I can add a lump sum of $15,000 to increase my policy value. That means that I may not have to spend time trying to qualify for an additional life insurance policy. I am sure I would pass because I am in good health, but no one wants to find out during an insurance health exam that they are uninsurable due to a health challenge.
There are certainly advantages to having multiple life insurance policies because using the Infinite Banking Concept, you can fund your own needs and never have to pay interest to a lending institution again.
Get an Annual Review
I had a friend who is an insurance agent review my life insurance policy. I did this out of a courtesy to him, but I knew I was happy with what I had. He didn’t seem to really understand the policy although he had been in the business for years and that’s because he doesn’t sell them. I didn’t understand the numbers 100% either, but in talking to my insurance company, I was told that the figures will change based on how much I contribute to the policy. The rep also told me that I could get a copy of the illustration (which is the chart of estimated values and death benefits) every year at no cost. She is going to send me two illustrations. One that shows what the numbers look like if I keep paying the minimum and another that shows me what it would look like if I add that max additional contribution of $3,000 per year for the next 23 years. I hope to retire sooner, but we have to plan for the worst while expecting the best.
What About You?
Do you know if you have the best kind of insurance policy for your personal situation? I would say that if you can’t use your life insurance policy until you die (such as with a term life insurance policy), that’s probably not ideal. If you would like an audit of your life insurance policy, I would be happy to connect you with an agent that helps people create the kind of life insurance policy that I have – one that you and your family can benefit from while you are still around. Feel free to contact me. There is no obligation and no cost, only benefits!
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