Individual life insurance is a crucial component of effective financial planning. It offers a safety net for your loved ones, ensuring their financial stability, and it also provides benefits related to estate planning and tax-deferred savings.

The death benefits from individual life insurance policies are typically exempt from federal taxes, allowing your beneficiaries to use the funds for any purpose they choose. This form of insurance can help you establish a legacy for your family or support important causes that matter to you.

Key Types of Individual Life Insurance

Individual life insurance can be categorized into two main types: term policies and permanent policies.

Individual Term Life Insurance

This policy type provides coverage for a specified number of years, usually ranging from 5 to 30 years. A term life insurance policy will only pay out death benefits if the insured passes away during the policy’s duration. It is a strategic way to ensure funds are available for specific needs, such as covering college expenses, settling debts, or paying off your mortgage, in case of untimely death within that timeframe.

Permanent Life Insurance

Permanent life insurance guarantees coverage for your entire life as long as you keep up with your premium payments. This policy type is often utilized for tax planning and estate management, as well as for funding trusts for dependents with special needs. Most permanent policies include a savings feature, allowing you to accumulate cash value on a tax-deferred basis. Typically, the premium for a permanent life insurance policy remains constant throughout your life and does not increase as you age.

Costs of Individual Life Insurance

The cost of individual life insurance can vary widely based on personal circumstances. Factors influencing the price include the type of policy, the level of coverage desired, overall health, and age. Our agent at Ocon Insurance Agency in Dallas Texas, is available to assist you in finding the ideal life insurance policy that meets your specific needs.