What Is Life Insurance?
Life insurance is a contract: you pay premiums, and if you die while the policy is active, the insurer pays a death benefit — a lump sum, usually tax-free — to your beneficiaries. If someone would struggle financially without your income, you likely need it.
Term vs. Whole Life
Term life: protection for 10–30 years. Cheapest — a healthy 30-year-old can get $500,000 of 20-year term for ~$20–$30/month. Right for most families.
Whole life: lifetime coverage + cash value. Premiums run 10–15× term. Only for specific estate-planning needs.
Universal life: flexible permanent policies. Complex and fee-heavy — understand fully before considering.
How Much Coverage Do You Need?
10–12× your annual income, plus debts and future obligations (mortgage, college), minus savings. An $80K earner with a mortgage and two kids typically needs $800K–$1M+.
What Affects the Price?
Age and health dominate. Tobacco use roughly doubles to triples rates. Then: coverage amount, term length, risky hobbies, and family medical history.
Frequently Asked Questions
How much life insurance do I need?10–12× annual income plus mortgage and major costs, minus savings.
Is term or whole life better?For most people, term — dramatically cheaper for the same death benefit.
Are payouts taxed?Generally no — death benefits are typically income-tax-free under federal law.
A life insurance policy is a contract between you and an insurance company: you pay a monthly or annual premium, and when you die, the insurer pays a lump sum (called the death benefit) to the people you name. A…
A healthy 40-year-old man can buy $500,000 of 20-year term life insurance for $48 a month with no medical exam. That is a real live quote for SBLI. Other companies charge $65 to $80 a month for the same policy,…
