WHAT IS PERMANENT LIFE INSURANCE & WHY OWN IT

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Permanent life insurance is a life insurance policy that does not expire as long as the policy is in force. Permanent life insurance combines a death benefit with a cash-value component that can allow the policyholder to build up a substantial amount of tax-deferred savings over time. Unlike term insurance which lasts for a specific period, permanent life insurance is designed for life long protection. 

Who can benefit from Permanent Life Insurance? 

• Children, Individuals and Families
• Business Owners
• Corporate Executives
• Doctors/Physicians
• Professional Athletes
• High Net-Worth Individuals

Many people today use permanent life insurance as a wealth building tool as well as to protect their family. This is due to many features and benefits that Permanent Life Insurance provide such as:

• Life Long Protection: As long as your permanent life insurance is in force, you are able to protect your family for as long as you live and not for a determined period.
• Cash Value: In life insurance, cash value offers liquidity. You are able to access your policy without a penalty or pay taxes before age of 59 1/2. You can benefit from building cash value in your permanent life insurance for retirement purposes and  to pay your life insurance premiums.
• Tax Deferred Growth: Permanent life insurance offers a means to accumulate tax-advantaged savings that can be accrued during the policy owner’s lifetime.
• Income-Tax-Free Death Benefit: A significant life insurance advantage is the death benefit payable to a beneficiary, which is generally income-tax-free.
• Business Considerations: Life insurance can act as a funding mechanism to cover several business contingencies. Situations in which it can be applied include business continuity, succession plans, buy/sell agreements for partnerships, or protecting a key employee.
• Holistic Financial Plan: Insurance should be a critical component of this approach, which factors in the actual plans and goals of a client when making decisions on financial models. It’s responsive to a client’s life events, such as divorce, unemployment, purchasing a home, or major illness.
• Retirement Planning: Life insurance can be a vehicle for supplemental retirement income. Term life insurance provides cost-effective basic protection upon death, however permanent life insurance has a cash value component that can accumulate and be used for tax free income. 
• Estate Planning: Life insurance can be used in estate planning to address debt, taxes, income replacement, probate, or charitable contributions. Several policies are applicable, including joint life that insures two people, with the death benefit payable upon the death of the second insured. Irrevocable insurance trusts can be created to act as a policy beneficiary to exclude policy proceeds from an estate.
• Charitable Giving: Life insurance proceeds are ideal for a charity contribution because they are not subject to income and estate taxes or probate costs.USA Permanent Life Insurance provides a wide variety of permanent life insurance products such as Whole Life, Universal Life, Indexed Universal or adjustable Life, Variable Life and Variable-Universal Life.

USA Permanent Life Insurance provides a wide variety of permanent life insurance products such as Whole Life, Universal Life, Indexed Universal or adjustable Life, Variable Life and Variable-Universal Life.

Whole Life is permanent insurance coverage that guarantees level premiums and the accumulation of cash values. Whole Life insurance is a good choice for long range-goals. There is participating whole life insurance usually issued by a mutual life insurance company where one participates as an owner of the company and there is non-participating whole life insurance issued by a stock life insurance company.

Client Profile:

• Clients with long-range goals
• Clients who might need access to cash temporarily or for emergencies

Benefits of Whole Life: 

• Guaranteed Cash Values- A portion of the money paid into a whole life policy accumulates as guaranteed cash values. Therefore, if the policy is surrendered, these guaranteed cash values would be available to the client. Or, as long as the policy is in force, the client may borrow against them as a policy loan at the current policy loan interest rate.
• Premiums level and payable for life- Since premiums are level, the younger your client is when they purchase the policy, the less expensive the annual premiums will be.
• Dividends- Whole life insurance policies can earn dividends. Dividends result when the actual life insurance costs turn out to be less than assumed when setting the premiums.

Universal Life Insurance, known as UL, is a flexible-premium, adjustable benefit life insurance policy that can also accumulate account value. Premiums and values are based on projections of assumed interest rates, the cost of insurance and the insurance company's expenses. 

Types of universal life insurance include:

• Guaranteed UL - sometimes called Protection UL
• Current Assumption UL - sometimes called Accumulation or Cash Accumulation UL
• Index UL - a current assumption UL with cash value growth based on index fund(s)

                 Benefits of Universal Permanent Life Insurance:

• Product is flexible, and gives clients the opportunity to accumulate cash
• Flexibility - You can adjust the death benefit and premium payments to fit your clients' needs
• Tax-Deferred Account Growth - The policy's Account Value earns interest at the company's current interest rate; federal income tax deferred. The guaranteed interest rate on a CAUL can be 2-3%, but the IUL policies will have a floor typically of 1% or 0% so there are not negative effects.

Like universal life insurance, variable universal life insurance (VUL) combines the protection of term insurance with an accumulation value. In addition, it offers the upside potential of variable investment options. It is also known for its flexibility in premium and death benefits.

Variable Universal Life Insurance Benefits:

• All the benefits of universal life insurance
• Flexible premiums and death benefits
• Cash value growth potential based on the performance of your policy's allocations
• Ability to choose where your premiums are invested
• Tax-deferred earnings