Some advantages of life insurance are:
1. Being able to leave money to provide for those who would be financially hurt by the insured person's death,
2. Not having to wait years to save up this amount of money,
3. Life insurance normally being exempt from income tax,
4. Life insurance normally being able to bypass probate,
5. Policy owners being able to choose their own beneficiaries,
6.Beneficiaries being able to use the death benefit as they see fit.
7. The versatility and availability of so many different policies to choose from.
The disadvantages could be:
1. Having so much life insurance that one does not have a good quality of life, when your beneficiary really won't need that much.
2. Getting Life Insurance when what the clients really want is a potentially high paying investment, and they are OK with risk.
3. Having to qualify for Life Insurance medically can be a disadvantage for those with poor health.
The advantages of having life insurance is knowing that your financial obligations will be taken care of and not a burden on your survivor. The disadvantage of life insurance is that for the vast majority the insureds do not match their Survivor's need for cash upon their death with the 'Right Kind' of insurance plan.
Consider for example: a married insured whose Spouse relies upon their income to sustain the expenses of daily living. What is the 'Right Kind' of Life Insurance plan and what is the 'Right Amount' of death benefit?
Term Insurance's disadvantage is the fact that very few deaths occur in the coverage period. Their need for income remains unprotected.
Permanent plan's disadvantage is the fact that only the wealthy can afford the face amounts required to support a Survivor's need for lifetime income.
Reversionary Annuity by design is the 'Right Kind' of life insurance plan when Survivor Income is the need. It is much more affordable than Permanent plans and 100% of the Surviving spouses will receive its benefit.
There are plenty of advantages to life insurance and no disadvantages. There are disadvantage of any life insurance policy is that it may be unsuitable for the policy owner based on budget, risk tolerance, liquidity needs and inappropriate polices for the planning goal. The two indemnification policies are Term Life Insurance and Guaranteed Universal Life Insurance. There are four income cash value life insurance policies: Participating Whole Life, Current Assumption Universal Life, Indexed Universal Life and Variable Universal Life.
Agent Owner, Gilmore Insurance Services, Marysville, Washington State
What are the advantages and disadvantages of life insurance? The advantages of owning life insurance are many as others have already noted. So I will focus on the one advantage life insurance has over any other product or investment option. Life insurance is the only product that instantly creates a pot of money upon the death of the insured. No other product can do this. Every other choice, the money has to be in your account in advance.
The biggest disadvantage to owning life insurance is that it is a boring product that simply does it's job. You will not impress your friends or others at parties when you talk about the performance of your life insurance plan. Cheers.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
The advantage of life insurance is that it addresses the possible loss people you love will sustain if you die prematurely. The disadvantage is that there is a cost involved. People frequently disregard life insurance because they are squeamish about the subject or do not want to alter their current spending patterns.
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1. Being able to leave money to provide for those who would be financially hurt by the insured person's death,
2. Not having to wait years to save up this amount of money,
3. Life insurance normally being exempt from income tax,
4. Life insurance normally being able to bypass probate,
5. Policy owners being able to choose their own beneficiaries,
6.Beneficiaries being able to use the death benefit as they see fit.
7. The versatility and availability of so many different policies to choose from.
The disadvantages could be:
1. Having so much life insurance that one does not have a good quality of life, when your beneficiary really won't need that much.
2. Getting Life Insurance when what the clients really want is a potentially high paying investment, and they are OK with risk.
3. Having to qualify for Life Insurance medically can be a disadvantage for those with poor health.
Consider for example: a married insured whose Spouse relies upon their income to sustain the expenses of daily living. What is the 'Right Kind' of Life Insurance plan and what is the 'Right Amount' of death benefit?
Term Insurance's disadvantage is the fact that very few deaths occur in the coverage period. Their need for income remains unprotected.
Permanent plan's disadvantage is the fact that only the wealthy can afford the face amounts required to support a Survivor's need for lifetime income.
Reversionary Annuity by design is the 'Right Kind' of life insurance plan when Survivor Income is the need. It is much more affordable than Permanent plans and 100% of the Surviving spouses will receive its benefit.
The biggest disadvantage to owning life insurance is that it is a boring product that simply does it's job. You will not impress your friends or others at parties when you talk about the performance of your life insurance plan. Cheers.