Milwicz Insurance Group

• Term Insurance- Life insurance which provides a level death benefit for a selected number of years (term). Term Life is available in 10-, 20-, and 30- year terms or until a certain age- 30, for example. Other types of term insurance include decreasing term insurance, decreasing death benefits which may be used to cover a declining mortgage.

Term life insurance policies are also categorized by their ability to be “converted”. Conversion is the policyholder’s decision to change the term policy into permanent insurance- such as Universal Life, which has no “term” and is in force until the age of 95. You also have the ability to continue your term insurance when your guaranteed term expires.

Term Life provides basic financial protection for your family and peace of mind for the policyholder. If you die while your policy is in force, your family will receive the death benefit tax free. This will allow your family; to maintain their standard of living, cover your final expenses, pay bills, provide a source of income or start an for you children’s education among other things.

For a business owner, Term insurance can be a “silent” partner in your firm. Term insurance can provide; debt coverage for new equipment purchases, allow you to secure loans for expansion or renovation, provide “key employee” coverage, and fund a partnership buy/sell agreement.

• Permanent Insurance- Life insurance which provide permanent insurance with either a guarantee of fixed premium, or a flexible premium design. Generally, permanent insurance also includes a cash value accumulation or account value, which may be used through loans to finance other life expenses- such as college tuition for a child.

Whole life is the traditional form of permanent life insurance and issued as a starter policy for a new baby.
20-Pay Life is a limited payment form of permanent insurance where lifetime
Coverage is needed without making commitment to pay lifetime premiums.
Life Paid-Up at Age 65 limited payment form of permanent insurance without making a commitment of lifetime payments
Universal Life is permanent life insurance which can be adjusted to increase/decrease the death benefit or increase/decrease cash value, Cash value accumulates, and interest accumulations are tax-deferred. Cash value of the policy may be accessed through borrowing or partial withdrawals.

Other types of permanent insurance can be used for small business employers for their employees. The type policy is based upon the number of employees.

• Annuities- An annuity is a legal contract between the issuing insurance company and the purchaser that accumulates money on a tax-deferred basis. Annuities are a trade-off between tax advantages and the ability to access money in the account. The major benefits of an annuity are its tax-deferred status and the fact that it provides a guaranteed; lifetime income. Thus, annuities are designed to be a long-term investment used for retirement savings.

In the accumulation phase of an annuity, also known as the “pay-in” phase there are two methods to accumulate funds. One, a single-premium annuity, or a flexible premium annuity. Obviously a single premium annuity is just that- one single payment and no future payments are permitted. With a flexible annuity, the timing and the amount of premium can be scheduled or varied.

Annuitization is the “payout phase”. Options include deferred, immediate and a settlement option. With settlement options, two forms of payment are available- Life Contingent- or based on the annuitants life expectancy, or Non-Life Contingent- based on a term certain- i.e., number of years. Surrender chares may apply; there is a 10% penalty for withdrawal prior to age 59 1/2. Consult a qualified tax advisor regarding tax issues regarding withdrawals/surrenders and settlement options.

For more in-depth information, complete the “Get a Quote” section.