Mortgage Protection

Mortgage protection is the most popular insurance that a new homeowner secures because a lot of times when a person buys a house, they go into debt. If the breadwinner in the family dies in debt that is not favorable financially for the rest of the family.

Most new homeowners think about buying mortgage protection because they don’t want to leave their families burdened. They do want to leave their family a financial legacy in form of a life insurance payment that covers the amount of the mortgage in case of their death or disability. The coverage amounts involved never go down with mortgage protection and the insurance never goes up. It is a level premium payment and it’s a level face amount.

There are some available riders on a policy. There are some accelerated death benefit riders, so if something happens to the client, and they have a terminal illness or something unfortunate, they can accelerate it with a chronic critical or terminal illness. This means they get a percentage of the face amount.

They can secure a family health benefit rider when something crazy happens to the person’s house. There is a way they can write a check for common carrier accidental death benefit rider that means the amount can double in the total amount, and if the insured dies in an accident then the accidental death actually lets the common carrier pay up to two times the amount and then the accidental death rider doubles it. There is also a waiver premium disability income rider is accident only. This is an important thing, so if the proposed insured gets disabled in an accident, then the insurance carrier doesn’t let them or doesn’t make them make premium payments for two years so the writer provides a monthly benefit for up to two years if the insured becomes totally disabled with 180 days of accidental bodily injury or sickness.

With mortgage protection, the key thing is it is by far the most popular coverage for new homeowners. Typically, people go into debt and then buy a mortgage protection policy so they don’t leave debt for their family and their house is paid off so that’s one less financial worry that the family has in the event of the death of the proposed insured. Foresters Strong Foundation is the main product we offer for people seeking this type of coverage.

FINAL Expense

Whole Life insurance coverage helps a family cover final expenses when a family member dies. The average funeral in America right now is $12,000. Final Expense coverage eases the financial burden placed on loved ones after a death of a family member. The coverage is permanent if you qualify and your rate never increases. Your benefits never decrease. A lot of families use final expenses for Social Security income replacement in a cash accumulating account that can temporarily cover missed payments as well. A lot of times they can come in different types like preferred, standard and basic with adjusted prices for each. There is no medical exam with whole life insurance, but the healthier you are the better your rate will be.

Children’s Whole Life

Mutual of Omaha offers a great children’s Whole Life policy for ages 0 years old to 17. It goes from a very small amount up to $50,000. It is the most standard children’s whole life plan you’ve ever seen in your life! Premiums never go up, the insurance amount stays the same and every single children’s whole life policy generates cash value. This means you can increase your insurance amount at 25, 30, 35, and 40 years old; or when you have a life event such as you get married, adopting a kid, buying a house, etc. A lot of times, a grandparent or parent buys their child a children’s whole life policy they transfer ownership so now the child owns the cash in the policy and it is building up over time.

The person or the proposed insured, AKA the child, they can use the policy they got from the grandparents or their parents and add to that. That means they never have to buy permanent life insurance again, there are very minimum health questions on the application, there’s a waiver premium, and all kinds of cool riders you can add to the policy. It helps cover costs associated with an unexpected loss. It’s great for parents looking to provide protection for a child’s future insurability, you know a lot of people that run into health challenges down the road. If you have a children’s whole life policy while you’re young, you can add to it based on your health when you were a child and got the policy.

There is very little underwriting and very little cost because these are whole life insurance policies for kids. It is very affordable with only two health questions. It has a guaranteed insurability rider, and it is one of those applications that the grandparents can get and the proposed insured obviously doesn’t have issues because they’re going to be 17 or younger. It is made for grandparents and parents to get their children set up for financial stability moving forward. It is a great way to start a permanent life insurance policy before the person really even becomes an adult.

Annuities

Annuities in the U.S. are primarily purchased for two reasons. First, if someone wants to move a lump sum and they don’t need it until retirement, they move this lump sum into an account that can never lose money. Over time, they turn 65 or 70. At that point, they can elect to get a monthly check guaranteed every single month, or until they die. This is called lifetime income. There are all kinds of lifetime income benefit riders that you can attach to annuities.

The second main way to use an annuity is to keep a bucket of money safe from market risk. Typically, the way annuities work is you are incentivized with a bonus to move your money. Let’s say that your product does have a bonus, so that is kind of a signing bonus, so whatever the percentage is they’ll give you a signing bonus for you letting them have your money for retirement. Let’s say that you’re meeting with a client and they roll $100,000 into an annuity. You know the company might hold onto their money for 10 years and then they’ll give them a 5% signing bonus for trusting them to let them have their money. The reason they’re able to do that is that you are basically getting an annuity that is not a liquid play, it’s a long-term retirement solution. It is just a way to keep your money safe.

The first way was the lifetime income guaranteed option and the second option is called college principal protection or moving a bucket of money so they can’t lose money. In college, they reach the law of 100. That is when you take whatever age you are, and believe that number is the amount of money that you should have in an account that doesn’t lose money. For example, if you are 33 years old you want 33% of your money in a relatively safe investment. 100 minus 33 is 67, so 67% of your retirement dollars should be in what is called a risky investment annuity. Annuities are not risky investments.

Typically, people over the age of 50 don’t want to lose any money because they don’t have the time to take the risk that a younger person does. If you know you don’t want to worry about losing money, you put money into either a fixed rate of return or an account that gets a percentage of what the market gets with no downside risk. You are participating in the gains but not in the losses. Zero is your hero.

The bad thing about annuities that you read on the Internet deals with liquidity, so that ability is a terrible investment. Let’s say you have $100,000 and you want to get a fair rate of return on that money next month. This is a terrible program because you’re signing a long-term commitment that is designed for people that don’t need the money for five years, 10 years, or whatever years you are talking about. Because of that, you’re being able to lock in interest rates, and you’re being able to participate in market gains with no market losses so there are all kinds of annuities. There’s fixed, there’s an index, and there’s variable with variable annuities. You can lose money, but The Alliance only does fixed and indexed annuities. Basically, an index means you can’t lose any money but you can get a percentage of the gains and fixed, it’s just at what the fixed rate is. A lot of people use annuities as a way to diversify their retirement dollars and put them in an account where they can’t lose money. They don’t have to worry about it, they can rest easy at night knowing that if the market crashes or another event like 9/11 or the COVID-19 pandemic happens their retirement dollars are safe inside of an annuity.