Life insurance is insurance that pays out when the insured passes away or after a specific time. Why should a bucket list item for entrepreneurs be getting life insurance? There are many reasons why this is a smart move.
Below, we'll share the many benefits of getting life insurance, as well as what to look for to determine the best life insurance companies, the best whole life insurance, and the ideal amount of coverage for you.
The Benefits of Life Insurance
Some benefits of life insurance include tax-free payouts, help with retirement, and help with living expenses for dependents. Below, we will look at each of these in detail.
#1 - Life Insurance Offers Tax-Free Payouts
As entrepreneurs, tax deductions or tax-free payouts are always a good thing. When the insured passes away while the life insurance policy is still active, their beneficiaries get a tax-free payout. They're not even required to report this money when they file.
#2 - Life Insurance Can Help With Retirement
Policies like whole life insurance accumulate cash value and can be taken out to help with retirement. Many entrepreneurs don't have the luxury of retiring, but life insurance can help you get to that point.
#3 - Life Insurance Covers Living Expenses for Dependents
Because the payout money is tax-free, life insurance can help cover living expenses for dependents. This money can help with bills, student loans, and other outstanding debts.
Life insurance is perfect for entrepreneurs that are needing extra help to care for themselves and their families. It is also a great benefit to off your employees if you have any.
The Best Life Insurance Company Characteristics
Determining the best life insurance company boils down to these three characteristics. Let's look at each trait in detail.
#1 - Excellent Customer Satisfaction Rating
Having an excellent customer satisfaction rating is a telltale sign that the insurance company is a good one. Trust people's opinions and experiences, and you will not be disappointed in this case. It will help you so much in the long run.
#2 - Ease of Access for Life Insurance Quotes
Some insurance companies give you the option to get life insurance quotes through their website. Others require that you talk to an agent. Regardless of how they do it, the best insurance companies will make getting a quote easy and accessible.
#3 - Low Premiums
When you have quotes from different insurance providers, compare them and see which has the lowest premiums. The one that does is probably the best of all of them.
Finding the best life insurance company is not an exact science, but these indicators should let you know which one to go with when buying life insurance.
The Best Whole Life Insurance and Coverage for Entrepreneurs
There are three main types of whole life insurance: traditional whole life, universal life, and variable universal life. Out of these three, traditional whole life insurance is the best for entrepreneurs.
Universal and variable universal life insurance options aren't bad, but they're not the greatest. These policy types have varied premiums and don't accrue cash value the way whole life insurance does.
Experts recommend that coverage should be roughly seven to 10 times the amount of your annual salary. That might be difficult to calculate for entrepreneurs because their yearly salary isn't consistent, but it's a good rule of thumb to use.
The Importance of Getting Life Insurance
As the CEO of your business, you have a lot on your shoulders. It's important to get life insurance, especially as an entrepreneur, because it can help you in so many ways. As stated previously, you can withdraw some of that money to help you retire, and it will significantly help your family should something happen to you.
About The Author: Peyton Leonard writes and researches for the life insurance comparison site, TopQuoteLifeInsurance.com. As an entrepreneur herself, Peyton cares about helping others succeed in their businesses.
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