Life Insurance. Shouldn't it be called Death Insurance? It can't be used until you die.?

It is my belief that what you are actually buying when you purchase life insurance is time. Most people have every intention of earning, saving or investing enough money to provide for their retirement, their final expenses, payment of any debts they have incurred, living expenses for their loved ones, a college fund for their children, a mortgage payoff fund, gifts for charities they believe in, and any number of other things they have a passion for and that cost money. Unfortunately death waits for no one and we cannot guarantee when it will come knocking--for me or you--it could be as soon as tomorrow or Lord willing it could be in 60, 70 or 80 years. Purchasing life insurance gives you the guarantee that even if it (death) comes knocking tomorrow you have already provided the necessary funds to do everything you had in your list of good intentions--it gave you time! In my biased opinion a good universal life policy (my preference) or a whole life policy (I don't like variable policies unless you are super sophisticated and enjoy taking lots of risks with your money) are the best bet because it provides for those good intentions immediately.

Basically some people say purchase a term life insurance policy and invest the difference for your retirement or your kids college funds, etc. The problem is that some people's good intentions about investing that money never happens or they choose the wrong type of investment vehicles then before you know it 10 or 15 years have gone by and they are left with a term premium they can no longer afford (most term life premiums are only guaranteed for the first 10 years) and virtually no retirement investment, mortgage payment fund or college fund. In addition no one can guarantee that you might not become disabled therefore losing your income and ability to save--you can purchase a disability waiver on most life policies to provide that your premium payments & therefore you policy is continued if you are disabled due to illness or accident.

Also note that with a Universal Life Policy you can borrow from the built up cash value and if you have been declared to have a terminal illness you can collect up to half of the face value from the insurance company (if your policy has a special endorsement attached) or you can have a viatical company purchase the policy from you.

My advice to most of my clients--buy a good Universal Insurance policy with a term rider so that you have all your bases covered and enjoy every day of your life--you deserve it!

Good Luck

That's like calling "car insurance" "accident insurance". What you're ACTUALLY insuring is your LIFE, and you're insuring it AGAINST DEATH.

Just like your car. You're insuring your CAR, against an ACCIDENT.

It's the negative connation associated with death is the reason they call it life insurance. Some ins plans do pay while you are alive.

you can cash it in before death if you have the right policy

Especially when the life settlement houses get into it and buy the policies and pool them and create things that are shaping to be something like death bonds.

Actually, a long time ago it was called "Death Insurance." No one bought any so they changed the name.

Actually, it should be called income replacement insurance- this is what it does, especially if a financial analysis had been done before purchasing the policy.

Actually, there are several life insurance products from which you can collect before death. Most of them are variables of whole life which accumulates cash value, that you can not only borrow against without actually "cashing in" the policy.

Some variations include an additional "investment" feature such as investing some of the money in mutual funds.

In general, most people are better off buying term insurance that only pays off in the event of your death. Some companies will now also pay you a monthly payment against a discounted face value. This is especially useful for someone who is incurring large doctor/hospital bills as a result of a terminal illness.

Thanks for asking,
Rod

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Yes, but it is always easier to sell something with the word "Life" than the word "death"

Ye, but it insures your life while you are alive

the benefit of the insurance for your heirs and beneficiaries comes upon your death but you as teh policy holder can withdraw any cash value out or loan against it for whatever reason

also depending on the rider(s) the death benefit can be used and withdrawn down prior to death as a Long Term Care Feature

in a country where you eat "Hot Dogs" anything can happen.

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