Life Insurance Plans

Group Life Insurance is an employer provided benefit that pays the beneficiary of an employee a fixed sum at the death of an employee. Generally, the premium paid by the employer for this benefit is deductible. The Internal Revenue Service has 4 guidelines that employer provided life insurance must meet in order to be considered Group Life Insurance:

1. The plan must provide a general death benefit that is excludable from income;
2. It must be provided to employees as compensation for services performed as an employee;
3. The insurance must be provided under a policy carried directly or indirectly by the employer
4. The amount of insurance provided to each employee must be computed under a formula that precludes individual selection of such amounts.

Buying life insurance is one of the best ways to protect your family against financial hardships. Unfortunately, many people don't realize the importance that adequate life insurance coverage plays in a family's financial well being. Talk with a Cotton States agent about your life insurance needs so you can protect your family's future.

Did you know that life insurance can:

• Clear financial obligations in case of death
• Ensure that mortgage payments are met
• Guarantee a fixed income for a surviving parent with young children
• Solve certain tax problems
• Provide a method for a closed corporation to liquidate stockholder interests
• Fund a business buy-sell agreement
• Provide children with college education
• Plus, many other benefits

Understanding Life Insurance
Universal Life Insurance is a permanent life insurance program that provides flexible premiums and an option of two adjustable death benefits. It also accumulates cash values and offers competitive tax-deferred interest. Loans and withdrawals are available on a tax-favored basis.

Term Life Insurance offers low-cost protection for a specified period of time. It is a temporary solution to a short-term need such as a housing loan, business expansion or large debt. This type of policy provides large death benefits at an initial low premium that increases as you get older. Some term policies, however, have an option that allows you to convert the policy into permanent insurance up to age 70.

Whole Life Insurance provides permanent protection at an economical price. It offers moderate premiums that are locked in at the time of purchase. The death benefits cannot fall below the initial face amount. There are guaranteed cash values and paid-up options.

Participating Life Insurance is a stable insurance program with guaranteed death benefits, tax-deferred cash accumulation and the flexibility to meet a wide range of financial goals. The participating life insurance guarantees that your premiums will never increase, your death benefits will not decrease and your coverage won't expire regardless of your age or health. This policy increases in value as cash accumulates. And, unlike other types of whole life insurance, this policy can pay dividends.

Guaranteed Issue Life Insurance provides coverage that is guaranteed to be issued, regardless of your health condition. No medical questions or exams are required. Since no underwriting is done, death benefits are usually graded, or otherwise limited, during the first few policy years and the maximum death benefits available are usually low.

Simplified Issue Life Insurance provides coverage that is underwritten from a simple application, consisting of just a few health questions. Usually, medical exams are not required. Death benefits are not graded or otherwise limited. Due to the limited underwriting, the maximum death benefits available are usually low.

Accelerated Benefit Rider - This rider advances a portion of the death benefits if the insured has been diagnosed with a terminal disease and has less than 12 months to live or is permanently confined to a nursing home.