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The California Dental Association and its 25,000 member dentists can provide information that will be most useful as you make decisions about which dentist to see, what preventive care you should take and what other matters that affect your dental health and that of your family are important to consider. Visit www.cda.org for more information or to locate a dentist in your new area.
LIFE INSURANCE
In the event of your death, life-insurance coverage provides financial compensation to your family. Life-insurance policy payouts are not subject to federal income tax, which provides the assurance that a surviving family will receive full benefit of the proceeds. In 2009, about 9.4 million individual life-insurance policies were bought. Life-insurance products for groups are different from those sold to individuals. The following information focuses on life-insurance policies sold to individuals. There are two major types of life insurance: term and whole life.
Term insurance is the simplest form of life insurance. It pays only if death occurs during the term of the policy, which is usually from one to 30 years. Most term policies have no other benefit provisions. There are two basic types of term life insurance policies: level term and decreasing term.
In 2007, virtually all (97 percent) of the term life insurance bought was level term.
Whole-life insurance is sometimes called permanent life insurance, and it encompasses several subcategories. There are three major insurance types of whole-life or permanent insurance: traditional whole life, universal life and variable universal life. There are variations within each type. Whole-life or permanent insurance pays a death benefit whenever you die—even if you live past 100.
In the case of traditional whole life, both the death benefit and the premium are designed to stay the same (level) throughout the life of the policy. The cost per $1,000 of benefit increases as the insured person ages, and it obviously gets very high when the insured lives beyond 80. The insurance company could charge a premium that increases each year, but that would make it very hard for most people to afford life insurance at advanced ages. The company keeps the premium level by charging a premium that, in the early years, is higher than what’s needed to pay claims, investing that money then using it to supplement the level premium to help pay the cost of life insurance for older people.
By law, when these overpayments reach a certain amount, they must be available to the policy owner as a cash value if he or she decides not to continue with the original plan. The cash value is an alternative, not an additional, benefit under the policy.
In the 1970s and 1980s, life insurance companies introduced two variations on the traditional whole life product:
universal life insurance and variable universal life insurance.
LIFE INSURANCE
In the event of your death, life-insurance coverage provides financial compensation to your family. Life-insurance policy payouts are not subject to federal income tax, which provides the assurance that a surviving family will receive full benefit of the proceeds. In 2009, about 9.4 million individual life-insurance policies were bought. Life-insurance products for groups are different from those sold to individuals. The following information focuses on life-insurance policies sold to individuals. There are two major types of life insurance: term and whole life.
Term insurance is the simplest form of life insurance. It pays only if death occurs during the term of the policy, which is usually from one to 30 years. Most term policies have no other benefit provisions. There are two basic types of term life insurance policies: level term and decreasing term.
- Level term means that the death benefit stays the same throughout the duration of the policy.
- Decreasing term means that the death benefit drops, usually in one-year increments, during the policy’s term.
In 2007, virtually all (97 percent) of the term life insurance bought was level term.
Whole-life insurance is sometimes called permanent life insurance, and it encompasses several subcategories. There are three major insurance types of whole-life or permanent insurance: traditional whole life, universal life and variable universal life. There are variations within each type. Whole-life or permanent insurance pays a death benefit whenever you die—even if you live past 100.
In the case of traditional whole life, both the death benefit and the premium are designed to stay the same (level) throughout the life of the policy. The cost per $1,000 of benefit increases as the insured person ages, and it obviously gets very high when the insured lives beyond 80. The insurance company could charge a premium that increases each year, but that would make it very hard for most people to afford life insurance at advanced ages. The company keeps the premium level by charging a premium that, in the early years, is higher than what’s needed to pay claims, investing that money then using it to supplement the level premium to help pay the cost of life insurance for older people.
By law, when these overpayments reach a certain amount, they must be available to the policy owner as a cash value if he or she decides not to continue with the original plan. The cash value is an alternative, not an additional, benefit under the policy.
In the 1970s and 1980s, life insurance companies introduced two variations on the traditional whole life product:
universal life insurance and variable universal life insurance.
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