Life Insurance in Phoenix, AZ
Life insurance can help provide a financial safety net for beneficiaries when the insured person is no longer there to support them.
Contact Ayala Insurance Services today for a personalized life insurance quote.
Types of Life Insurance
There are several types of life insurance, including the following:
- Term life insurance covers a specific time, usually 10 to 30 years. Beneficiaries can apply to receive the death benefit if the policyholder passes away during the term.
- Whole life insurance is designed to provide coverage for the insured’s entire lifetime if premiums are paid as agreed. In addition to the death benefit, whole life insurance accumulates cash value, which can be accessed during the policyholder’s lifetime through withdrawals or policy loans according to the policy’s rules.
- Universal life insurance offers flexibility in premium payments and death benefits. Policyholders can adjust the death benefit, timing and premium payments to suit their changing financial needs, depending on the policy’s rules. Universal life insurance also accumulates cash value. Policyholders may be able to use the policy’s cash value to cover premiums or take cash withdrawals.
- Variable life insurance combines a death benefit with an investment component. Policyholders can allocate their premiums among various investment options, such as stocks or bonds, with the potential for higher returns. However, the cash value is subject to market fluctuations, so an element of risk is involved.
How Life Insurance Policies Work
When an individual purchases a life insurance policy, they agree to pay regular premiums to the insurance company. In return, the insurer promises to pay a death benefit to the beneficiaries upon the policyholder’s passing. The death benefit represents the amount of money the beneficiaries may receive if the policyholder dies while the policy is in force.
The premium amount for the life insurance policy is determined based on various factors, including the individual’s age, health condition, lifestyle, occupation and the type and extent of coverage chosen.
Maintaining timely premium payments is crucial to ensure the life insurance policy remains active. Failure to make payments could result in the policy lapsing, in which case the beneficiaries would not receive the death benefit.
What Life Insurance Covers
Life insurance can help cover the financial risks associated with premature death, including the following:
- Funeral and burial costs
- Secured and non-cancellable debts, such as a mortgage or car loan
- Income replacement
- Estate taxes
For more information and assistance choosing the right life insurance coverage, contact Ayala Insurance Services inPhoenix, AZ.