Life Insurance 201 – Intermediate info on what is it and how to get the lowest price

woman with ring insurance binder

Life Insurance 201 is an intermediate level guide.

Our goal of Life Insurance 201 Guide is to be a helpful resource for you to get the best possible scenario for life insurance. This Life Insurance 201 Guide should take the “gamble factor” out of choosing and setting up a life insurance policy for you and your loved ones. It will help you select a policy for the rest of your life so you’re squared away with the best possible price.

What are the Two Types of Insurance Benefits?

Throughout this Life Insurance 201 Guide, we will focus on the types of insurance benefits. There are two types of insurance benefits: Living Benefits and Death Benefits.

What is a Death Benefit?

death benefit claim

A death benefit is a guaranteed payment to the beneficiary of your life insurance policy after you die. Great news! The death benefits that are paid to your beneficiary are not subject to income tax. Your beneficiaries normally receive a lump sum of your policy benefit upon your death. You can be creative as to how your death benefits are doled out. For example, as a policyholder, you can tell them that you want your underaged child to only receive half of the benefit immediately after your death and the other half a year after the date of death. You can even stretch that out to month-to-month or even annual payments for a specified number of years. So you can preplan how your beneficiaries will receive your death benefits.

Life Insurance 201 Shows How to Change Death Benefits into Retirement Accounts


retirement keyboardOn another note, your beneficiaries can elect to use their death benefit proceeds to transfer it to open their own retirement account. However, your beneficiaries should be warned that when they reassign their inherited death benefits to open a retirement account those funds are then treated differently than life insurance monies.  The death benefits from these accounts will probably be subject to taxation.

Of course, this all depends if your premiums have been paid in full up to the day that you die. Under any insurance contract, your death benefit or inheritance benefits are guaranteed to be paid to your designated beneficiary, as long as the premiums are satisfied while you are still alive. After that, your beneficiaries can even choose to have the option to receive their death benefit proceeds either in the form of a lump-sum payment or as a continuation of monthly or annual payments.

What is a Living Benefit?

 Living Benefits or an accelerated death benefit is a rider to your policy that can be used if you become terminally ill or require long term care. Long term care includes nursing homes, assisted living, or in-home care. Some of these riders can give you substantial discounts that sometimes more than cover your policy costs. These riders are labeled chronic or critical riders. If you get a critical or terminal condition, the life insurance company will just send you your money while you’re still alive.

Should you Choose a Chronic Rider?

woman with cold

If you get a chronic condition, then you’ll get anywhere from 25% to 100% of your benefit depending upon the company and their product. For example, if you’re diagnosed with CLPD, a group of lung diseases that block airflow and make it difficult to breathe you will qualify. The most common conditions are emphysema and chronic that make up COPD. You will most likely get most of your benefits while you’re alive.

In conclusion, death benefits go directly to your loved ones upon your death. On the other hand, living benefits go to you while you’re still alive to cover your long term care. If you’re unsure which plan you want give us a call at Protect With InsuranceWe can see if you qualify for those programs with A-rated insurance companies.

What Most People Don’t Know About Life Insurance 201

This Life Insurance 201 Guide reveals insider information about additional benefits you can receive and do. If you’re only receiving 25% of your total face amount in living benefits you can just keep the policy. However, you do have the option to stop the policy at that point. Your original policy will still send you that living benefits check even after you drop it. You just need a doctor’s letter stating you have a chronic condition.  You can actually get another policy with another insurance company after that, while still receiving the 25% from the other policy.

Daily Living Discounts

Life Insurance 201 keeps the costs

We represent some of the top A-rated insurance companies that offer some of the best discount programs in the country. These little known discounts are saving people tons of money, You can get anywhere from 10 to 60% discounts on prescription medicines,  dental costs including cleanings, X rays, eyewear, hearing aids and batteries even legal fees like a free will.

Borderline Living Benefit

Borderline Living Benefit is the level of your policy’s cash value.

Typically it’s going to take 10 or more years with most companies to accrue enough cash value. So if you’re hoping that in three or four years, you’re going to accrue cash value and you’re going to be protected with that, it’s probably not enough time. For most people, the cash value is more of an issue if they’re under the age of 65.

So your policy’s cash value is going to be less of a benefit if you are 75 years old. However, if you expect to live another 15 years then you may be interested in the cash value of your policy.

Most people never take advantage of cash value. If you do, you need to know that it does negatively impact your loved ones. Tapping into your available cash value reduces the amount of insurance money your beneficiaries will receive.

How to Get the Best Prices with Life Insurance?

There are two main ways to get the best prices with life insurance policies. One is you need to have perfect or near-perfect health. If you do, you can get a jumbo whole life insurance policy. This is a whole life insurance policy with all the bells and whistles at a reduced price. And again, you’ve got to be super healthy for this. This is the kind of policy that oftentimes will require a medical exam.

Why Shop A-Rated Life Insurance Companies?

Life Insurance 201

Now for the rest of us that don’t qualify for jumbo whole life insurance, we have another way. That is to shop as many A-rated life insurance companies as possible.

You should shop as many as you want but they need to be A-rated with A.M. Best, which rates a company’s financial stability. A.M. Best is a credit rating agency focused on the worldwide insurance industry. Founded in New York City in 1899 by Alfred M. Best, the privately held company is headquartered in Oldwick, New Jersey. A.M. Best is the only rating agency that specializes solely in the insurance industry.

That should be your only requirement for shopping for these companies. Most people don’t have the time or wherewithal to do this.  So  the easiest way to accomplish that is to reach out to an agency like Protect With Insurance.

Make sure you connect with an agency like ours that diligently shops A-Rated insurance companies from the get-go. And frankly, that’s what they should all do. But they don’t, and it’s very frustrating because there are a lot of agencies out there that don’t. Many clients are placed into policies where they think everything is fine. Then 5 or 10 years down the road, they discover they are with a B or a C -rated life insurance company. Those types of low rated companies most likely will go bankrupt.

It turns into a nightmare for them. So, aside from just insulating yourself from the bankruptcy of your life insurance company, you want to be with A-rated company because there are a lot of other benefits. Insurance agents are the best way to find out what benefits you can qualify for.

Agencies Are the Best Insurance Shoppers

A good agency can shop a multitude of A-rate insurance companies in the blink of an eye. So it’s so simple to take just 5 or 10 minutes of your time to get in touch with an agent at a qualified broker agency like Protect With Insurance.      We will shop ten or more companies for you right off the bat . Insurance agents can also help you negotiate your price down and at the same time get you as much coverage as possible. This is especially important if you have any health issues whatsoever. Oftentimes that means if you are taking even one or more prescription medicines due to a medical diagnosis of any condition.

At Protect With Insurance, we can help you get a great health rating despite many conditions because we have narrowed our search down to highly qualified A plus insurance companies. These types of companies are able to offer you a preferred health rating. That is a gold star in the insurance industry because it is your ticket to getting the best price and the best coverage available.

Let us help you get the best life insurance policy out there for you. You can get an online quote to get your started then give us a call and we can guide you every step of the way. For faster service start a chat at Or just give us a call at 928.323.0933.