Term Insurance

Protection and Peace of Mind at an Affordable Price

As with any type of insurance, term life can protect your family, estate, and business interests. Ensuring that your family can protect their lifestyle in your absence is the primary purpose of life insurance.

• What is term life insurance?
• How is term life insurance different from permanent life insurance?
• Who is a candidate for term life insurance?
• Why should I purchase term life insurance?
• How much life insurance do I need?
• Optional benefits and riders.

What Is Term Life Insurance?

Term life insurance is temporary, affordable life insurance. It is purchased at a low cost for a specified period of time, and rates are guaranteed for the entire period. You typically pay a fixed premium over the specified length of time to guarantee a death benefit for your beneficiary. If you die within the term period, a death benefit is paid to your beneficiary, usually free of income taxes, as long as the premium payments are up-to-date and the policy is active. Term is available for periods of 1, 5, 10, 15, 20, and 30** years. DeSpenza Capital Management, LLC offers some of the lowest term rates in the industry.

Once the term period expires you can continue your term coverage to age 95. You can also convert it to permanent insurance; the conversion time will depend on policy provisions. Both options will typically result in higher premiums and will require having a medical exam or providing other information about your health. Renewal premiums generally increase with age and could become unaffordable later in life. Term renewal premiums are guaranteed not to exceed a maximum amount for your age. Ask DeSpenza Capital Management, LLC what the premiums will be if you continue to renew the policy. Also ask if you lose the right to renew the policy at some age.

How Is Term Life Insurance Different From Permanent Life Insurance?

While term life insurance only provides protection for a specific period of time, permanent life insurance (whole life insurance and universal life insurance) can provide protection for the insured's entire lifetime.

Permanent life insurance builds cash value; therefore, it can be used as a cash-accumulation vehicle for long-term goals like retirement or for a child's college education. Cash-value growth in permanent life insurance policies is generally tax-deferred, meaning that you pay no taxes on any earnings in the cash value policy so long as the policy remains in force and no withdrawals are made. At the time funds are needed, you can borrow against the accumulated cash value of a permanent life insurance policy or withdraw up to the amount of the premiums paid. Money can be taken out of the policy via loans without having to pay taxes, since policy loans are generally not considered taxable income, and withdrawals generally can be taken up to the amount of premiums paid without being taxed. Withdrawals in excess of premiums paid are taxable. It is important to note that loans, withdrawals, and any unpaid loan interest can reduce the death benefit.

Term life insurance accrues no cash value; therefore, you can purchase large amounts of term coverage at a lower cost than if you purchased permanent life insurance. While permanent insurance is initially more expensive than term insurance, over time the permanent insurance may be more economical since premiums do not increase with age. Also, if you cancel a permanent life insurance policy, you receive the accumulated cash value. Surrender charges and taxes may apply.

Who Is a Candidate for Term Life Insurance?

While it may not be a practical choice for long-term needs, term life insurance is ideal for those who:

• Need protection for known periods of time—usually to protect a short-term need like paying off a mortgage, loan, or business debt, or to provide a death benefit during peak earning years when children are young.
• Need a large amount of insurance protection but has limited incomes and can't afford permanent policies.
• Need to add a large amount of coverage to complement existing permanent policies at the lowest possible cost.
• Are willing to pay premiums that may increase if coverage is extended past the initial term period.
• Have specific business needs (e.g., business owners who want to cover the life of a key employee who has a set number of years until retirement).

Why Should I Purchase Term Insurance?

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• Ensure Your Family's Future
• Mortgage Protection
• Debt Protection
• Business Protection
• Charitable Contributions
• Compliment Your Permanent Life Insurance Policy
• Accelerated Benefit for Terminal Illness

How Much Life Insurance Do I Need?

Now that you know what and why of term life insurance, it is time for you to consider how much life insurance you need. DeSpenza Capital Management, LLC can assist you in determining your financial objectives, selecting the right life insurance coverage for you, and designing a financial plan to meet your needs.

Optional Benefits and Riders

Optional benefits and riders can be added to your Term insurance policy. These riders and benefits are designed to enhance your term policy with increased flexibility and value.

Accidental Death Benefit — Increases the insurance proceeds if you die from accidental bodily injury.

Children's Rider — Insures each child in your family as part of your policy.

Spouse Rider— Insures your spouse for an amount less than $100,000 on the same policy.

Additional Insured Rider — Insures your spouse or any other person for amounts greater than $100,000.

Waiver of Premium — Waives payment of your premium if you become disabled for six months or more. The premium waiver continues as long as you are disabled.

Limited Waiver of Premium — Waives your policy premium payment during the first ten years of the policy or the initial guarantee period, whichever is longer, while you are totally disabled. This is a less expensive option than Waiver of Premium.

Feel free to contact us for a no obligation, no cost analysis of your investment portfolio. Our clients benefit from our counsel and process of customized service. We are not just selling a single investment or idea. DeSpenza Capital Management, LLC is proposing a serious investment process by which you can manage you money for a lifetime. Please contact us for a free Complimentary Consultation to discuss diversification opportunities for income, savings, and legacy. This intro page gives you a brief synopsis of each investment category of service we offer.

  Complimentary Consultation

  877-337-7369

email: adespenza@despenza.com

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