SOURCE: Miceli Financial Partners
SAN JOSE, CA--(Marketwire - September 03, 2012) - Four out of 10 American households with children under 18 report they would have immediate difficulty paying for everyday expenses if the family's breadwinner died today, according to a 2010 Life Insurance Ownership Study from LIMRA, an insurance industry think tank.
Yet insurance solutions are available, said Andrew Miceli, general agent of Miceli Financial Partners, San Jose agency of MassMutual.
Term life insurance is designed to cover someone for a certain amount of time, like 10 or 20 years. The product can be a great first step for young families needing to stretch their budgets.
"Term life insurance is an affordable protection product for those looking for the maximum amount of coverage," Andrew said. "The key to making a good decision about term insurance is understanding how the product works and if it is convertible so you can gain permanent coverage as your income and responsibility grows."
Some policies come with an option to convert a term insurance policy to permanent insurance for a certain time period without having to go through a health exam. A permanent policy protects a family until the insured dies and sometimes grows in cash value over time. A permanent policy can provide living benefits to a family in the event they need money for a down payment on a house or to supplement retirement income in down market, among other things1.
There are a few key things people should ask their financial professional to help ensure they fully understand the insurance policy they intend to purchase to protect their family. Typically after the level premium period of a term life insurance policy, the premiums increase and often make the policy cost-prohibitive. Many times consumers will shop for a new policy only to learn that because of health challenges they are no longer able to find affordable term insurance.
When shopping for term, Andrew suggests asking the following:
Is the policy convertible?
What are the conversion options?
What happens if I don't convert?
1. Access to cash values through borrowing or partial surrenders will reduce the policy's cash value and death benefit, increase the chance the policy will lapse and may result in a tax liability if the policy terminates before the death of the insured.
*Insurance products issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA, 01111-00001 and its subsidiaries C.M. Life Insurance Company and MML Baystate Life Insurance Company, Enfield, CT, 06082.
Founded in 1851, MassMutual is a leading mutual life insurance company that is run for the benefit of its members and participating policyholders. The company has a long history of financial strength and strong performance, and although dividends are not guaranteed, MassMutual has paid dividends to eligible participating policyholders consistently since the 1860s. With whole life insurance as its foundation, MassMutual provides products to help meet the financial needs of clients, such as life insurance, disability income insurance, long term care insurance, retirement/401(k) plan services, and annuities. In addition, the company's strong and growing network of financial professionals helps clients make good financial decisions for the long-term.
MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives. MassMutual is headquartered in Springfield, Massachusetts and its major affiliates include: Babson Capital Management LLC; Baring Asset Management Limited; Cornerstone Real Estate Advisers LLC; The First Mercantile Trust Company; MassMutual International LLC; MML Investors Services, LLC, Member FINRA and SIPC; OppenheimerFunds, Inc.; and The MassMutual Trust Company, FSB.
For more information, visit www.massmutual.com or find MassMutual on Facebook, Twitter, LinkedIn, YouTube and Google+.