There’s More to Life Insurance Than Just a Policy

We’ve all seen the commercials depicting a fictional couple discussing getting life insurance right this minute. What’s the rush?

As an insurance agent, you’re probably thinking, I know why! You understand the importance of life insurance coverage. But do your clients? Some might think life insurance is just another policy, just another premium payment. That’s why it’s important to relay all the benefits life insurance brings to your clients!

We’ve laid out some of the key perks of life insurance that make this coverage more than just a policy!

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Term vs. Whole Life Insurance

You’re likely already aware of the differences between term and whole life insurance, but for the sake of keeping this post comprehensive, here’s a quick refresher.

The main differences between term and whole life insurance are cash value and premium rates.

With term life insurance, you can lock a set premium payment for a set length of time — 10 years, for example. Generally, term life insurance is the most affordable type; however, the trade-off is there’s no cash value accrued.

It’s important to note the length of the term, is the length of the policy contract. For instance, at the end of the 10-year term, the policy will end or convert to a year-to-year contract with much higher rates.

On the other hand, a whole life insurance policy will build cash value at a steady, fixed rate. This cash value can be taken as a lump sum or a withdrawal. Whole life policies have a fixed premium that is paid for the duration of the policy (until the policy holder passes).

The cash value can be a big selling point of a whole life insurance policy, while the affordability can be for a term life. It’s crucial to fact find while meeting with clients and consider their needs, wants, and budget. This will help you present the right type of policy for their specific lifestyle.

Offer Peace of Mind

Imagine this: You’re sick and need to go to the doctor. You breathe a sigh of relief knowing you have health insurance to cover costs.

This same type of peace of mind is present with life insurance coverage! No one can anticipate the future. It’s a significant selling point for clients to know they can breathe a little easier by securing financial protection for their loved ones after they have passed. Family and friends won’t have to worry about how to afford the funeral and burial/cremation or how to keep paying the bills if they need to take time off work to grieve. This simple, yet crucial, benefit of life insurance can be reason enough to secure this coverage!

Protect Loved Ones

When you sell a life insurance policy to a client, you’re not only helping them, but their entire family.

Speaking of protecting loved ones with a life insurance policy, the death benefit of life insurance can cover expenses someone who has passed may leave behind. A key perk of a death benefit is that it’s most commonly paid out as a tax-free lump sum. Loved ones can use this money however they wish — to pay off a mortgage, for everyday costs, to help pay for their child’s education, and more! When you sell a life insurance policy to a client, you’re not only helping them, but their entire family. That’s a pretty rewarding sale if you ask us!

Provide Income Replacement

Replacing an income is another expense a death benefit can be used for. Clients with a spouse or significant other most likely have planned for a future based on two incomes. If one of those is taken away, especially if unexpectedly, it can create a difficult situation for the person left behind. This lost income can be replaced because of the life insurance you helped your client purchase. Their loved one can continue living the life they’re accustomed to and have planned on.

Cover Looming Debts

Though we try to avoid it, debt is a reality and sometimes unavoidable. Inheritance can be a good thing (aside from the circumstance) but not necessarily when it includes debt. No one wants to pass on that responsibility to their loved ones. This is where life insurance can step in once again and come to the rescue! Expenses like credit card debt, a remaining balance on a mortgage or car, estate tax, and more can all be covered by a life insurance policy.

There are certainly additional reasons why life insurance is more than just a policy, but what it ultimately always comes back to is peace of mind. When dealing with such an uncertainty, a little bit of preparation and sense of control can go a long way, and you have the unique and fulfilling opportunity to provide this to your clients!

Ritter is ready to help you start selling life insurance or amp up these sales. Register with Ritter for free, if you haven’t already, and always feel free to reach out to your dedicated Ritter sales specialist!