Many people including a number of insurance people choose not to
call life insurance an investment. Why?
Many people including a number of insurance people choose not to call life insurance an investment. Why?
Well there are probably several explanations as to why life insurance is life insurance, and investments are investments. Yet I have never heard a good one, have you?
Could it have anything to do with balanced markets and industries protecting their own interests … hint, read up on 151A, which pertains to the battle between the states and the securities and exchange commission over jurisdiction of fixed index annuities.
Annuities are life insurance products that can protect your principal, offer potential for accumulation and/or guarantee an income for life.
Life insurance products are often overlooked products in the sense that, at the very least, they offer guaranteed value.
There are several types of life insurance and it’s fair to say, a variety of hybrids. Some offer cash value build-up on a guaranteed basis, some don’t. Some offer cash build up on a guaranteed basis and legitimate cash accumulation potential in addition to the guaranteed amount.
Some policies are good for a specified period of time and pay a death benefit only.
Each has advantages for specific goals and profiles. Naturally, one needs to do his or her homework in determining which carrier will best serve his or her needs, once those needs are clearly spelled out.
One thing is certain. If you have a life insurance policy, even a term policy paying a death benefit only, and you die prematurely, there will be recognized value when the proceeds of the policy are paid to the beneficiary (ies).
If you pass away before your intentions for your loved ones are met, the life insurance policy can provide the means to fulfill your wishes as if you had lived.
Life insurance can be used to meet a variety of highly valid personal and business needs.
There are probably several explanations as to why life insurance is life insurance and investments are investments. Yet I have never heard a good one, have you?
Tom O’Connell is an independent life insurance specialist. He resides in Morgan Hill with his wife Carolyn. Contact him at 762-9762 or go to tocinsurance.com. His column runs on the fourth Tuesday of the month.