YES!  The company does matter when you purchase life insurance. It’s important to understand the assets and liabilities of the compay, its third party ratings, and whether it’s a stock or a mutual company.

And, no, the company doesn’t matter.

You see, well, it depends…

Do you have term insurance?  If so, is it level for 5-, 10-, 15-, 20- or 30-years? Do you have the Waiver of Premium rider or the Return of Premium rider?

Do you have permanent insurance? If so, do you have universal life, whole life, or a blend of term and whole, also known as a “hybrid” or “blended” product? Is it variable or traditional (fixed), or is it an equity indexed plan? Are the premiums guaranteed, and is the death benefit guaranteed? If so, for how long?

Confusing? I might be able to help!

Life insurance can be owned or rented. If you purchase a “permanent” policy, the objective of the policy is to remain in-force until the day you die. If you purchase a “temporary” policy, the objective of the policy to remain in-force for a specific number of years.

However, keep in mind that a policy that is initially acquired to be permanent may turn into temporary coverage if the policy is not adequately funded.

Life insurance, as a financial vehicle, is very difficult to understand. The death benefit and premium are perhaps the easiest components to determine, but that’s where the simplicity ends.

- What’s guaranteed and what’s not guaranteed…?

- Is the premium fixed or flexible - the amount and when it’s due…?

- Are there cash values illustrated in the policy…?

- How do the policy’s costs, expenses, and returns have an impact on the current and future performance of the policy…?

- What happens to the policy if the premium is not paid in cash…?

- How reliable is the illustration that I’m looking at…?

These are just a few questions to consider when trying to understand what policy you have and/or what policy you’re contemplating to purchase.

The amount of life insurance that someone needs is NOT necessarily a multiple of one’s income.

Define what your financial objectives are, what resources you have available to offset those objectives, and with certain assumptions (investment rate of return, inflation rate, and tax rate), you’ll know if there’s a gap between your objectives and your resources.

Understanding all of this should help you determine the proper amount of life insurance that you need to fill in this gap.

We are proud to announce this new and exciting addition to My Health eSite. My Health eBlog will be an ongoing dialogue between our visitors (that’s you!) and our resident life insurance expert David Tuason.

David Tuason has more than 15 years in the life insurance industry and has trained and collaborated with several of the country’s leading life insurance agencies.

He has made countless professional presentations to attorneys, business managers, CPAs, trust officers, wealth managers, life insurance agents and home office employees.

And now, he’ll be making presentations to YOU. His focus will be in helping people understand how life insurance works as well as the best way to acquire it. In other words, David wants to help you make sense of it all. Here are some of the specific topics he’ll be covering in the upcoming weeks:

• the importance of reviewing existing life insurance on an annual basis
• how much life insurance is needed and what kind you should get
• the value of cash values in permanent life insurance
• what guarantees mean in a permanent life insurance policy
• financing permanent life insurance premiums
• term insurance designs and what makes the most sense
• getting the best underwriting for your policy

So, stay tuned for David’s 1st posting in the very near future.