Many ask whether or not life insurance plays a role in the retirement planning process, and it can actually be very beneficial for those planning to retire to purchase a life insurance plan. Life insurance doesn’t have to be an extremely complicated process, since it’s meant to make life easier once an individual has passed.
Although many companies have tried to reevaluate life insurance to make it become something jazzed up and completely different, Rene Lacape, Marketing Manager for eQuote Life Insurance, believes it is important to “stick to the basics” when it comes to buying or selling a life insurance plan. Certain categories of life insurance are very popular among the retired and soon to be retired community, such as cash value life insurance that can be used either inside or outside a pension plan.
It can be beneficial either way, and even provide extra tax deductions for the purchase of the premium each year. Market risk protection is also offered with a cash value life insurance plan, and is available on the plan from day one all the way until the value of the plan is distributed. The distribution options on the life insurance plan include the participant buying the policy from the pension plan, the ownership of the plan changing from one individual to another, or a maximum loan is made from the policy using the premium that has been paid into the account.
If death of the participant does occur, the policy can be immediately paid to the designated beneficiary, without the need or probate court or any other deciding factors. It is beneficial for the beneficiary, since it offers the premium right away up until the retirement plan benefits kick in. It is also ideal for the beneficiary, since the proceeds in excess of cash value from the life insurance plan are also tax free.
Life insurance is capable of satisfying the more conservative side of a portfolio,” says Rene Lacape, Member of the San Diego Hispanic Chamber of Commerce and guest radio host on Radio Nueva Vida. “People are traditionally looking for peace of mind, protection and guarantees when they consider purchasing the life insurance that will cover them and their loved ones.” Nobody wants to be locked into anything these days, though, so living benefit flexibility is really important.
The life insurance industry really needs to focus on helping the Y and X generations by showing them how to get started with financial security. They need help getting started when it comes to the most basic things like disability income, monthly savings and life insurance, adds Rene Lacape. “The younger generations are not looking for complexity, but what they are seeking is integrity, honesty and generosity.