20 Pay Life Insurance

By July 15, 2013Insurance
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Get Life Insurance coverage for “Free” with a 20 Pay life cover policy

20 pay insurance

How would you feel if I was to say, here and now, that there was genuine Life Insurance available to cover your every possible need that would cost you next to nothing?

Surprise? Disbelief? Waiting for the catch? I don’t blame you. It sounds almost too good to be true.
I mean, really, how can an Insurance Company cover you for literally no cost and remain financially viable? The real question you should be asking is: where do I sign?
But, the world being what it is, you want to know more about the product first. Again, I totally understand. What’s more, I agree.

What is this virtually no cost life insurance?

The product is a sound 20 Pay Life Insurance policy. You may have heard the term, even have an idea of how they work. But not all options are created equally.
Rather than select the cheap Term Insurance, I’m going to explain how you can take advantage of the Permanent insurance this type of policy offers.
With the Permanent option, it doesn’t matter at what age you die, this insurance will be there for you. And, unless you’ve found the golden elixir of youth, it’s an absolute given that one day we are all going to shuffle off this mortal coil.

So, for this particular life insurance option, let’s look more closely at 20 pay permanent insurance.

In summary, you pay the nominal premium for twenty years and at the end of that term, you’ll be presented with two options.

1. You’re happy with the insurance and decide that you’d like to leave it in reserve for your loved ones after your death. In this case, you pay no further premiums beyond the twentieth full year and the insurance is always there as a safeguard without you having to contribute anything further. Ever.

2. Your circumstances dictate that you no longer need the insurance to cover any costs after your death and you’d like to cash in the policy. That’s fine, too; and here’s where the policy truly benefits you and brings home to roost the promise of costing virtually nothing. Almost every cent you’ve paid into the policy is returned back to you, should you decide to cash the insurance in at the end of the 20-year pay-in period. The returned sum, the payout, you’ll receive as an extremely tax-efficient Accumulated Cash Value.
There is only one small deduction, and that’s the part of your premium that constitutes the monthly policy fee. At current rates, that equates to approximately $7 per month, so its impact will be negligible, in comparison.

That’s a lot to take in, so let’s look at a real life working example.

20 pay life insurance

Tracey is 35, she’s recently become a mother and wants to ensure that there’s adequate cover in place should anything tragic happen over the next 20 years. What young mother wouldn’t? She’s in general good health, is a non-smoker and is considering a 20 Pay Life Insurance Product to provide the essential coverage she’s looking for whilst her baby blossoms into young adulthood:

A $100,000 Face Amount

The monthly premium: $70
Term/length of plan: 20 years
Policy Accumulated Cash Value in 20 years: $17,000

Not only does this look like a great investment in principle, but there are even more reasons why this is the perfect option for Tracey right now:

1. The affordable Life Insurance coverage Tracey is looking for is in place, not just for the term of the policy, but for the rest of her life should she choose to keep it at the end of the payment term
2. Should Tracey decide she doesn’t need the coverage in the twentieth year, there’ll be a large Accumulated Cash Value waiting for her; this could either pay for her new child’s further education or she could gift it as a sizable nest egg so that her child can begin their own life journey with a solid platform.
3. Should Tracey decide to keep the insurance policy at the end of the 20 year term, it will not cost her another penny. However, she will have created an asset worth $100,000 for her family, which only cost $17,000 to build. Now that’s what you call a return on your original investment!

Life Insurance premiums should be redeemable

It’s important to realize the options open to you with life insurance and that such a policy needn’t be money wasted if you never have cause to draw on it.
You may be reading this thinking that $100,000 may not be worth what it is now in 20 years’ time. That’s absolutely fair comment.
If that’s the case and you’d like to increase the Face Amount value of your asset, additional Term insurance can be added to run in conjunction with the Pay 20 Permanent Life Insurance policy.
A “good” 20 Pay policy will perform for you, though, as long as it’s set up diligently at the outset and will provide a solid asset for your family’s future and your estate.
If this sounds like something you should be doing today, call us. We have the experience matching the right insurance product to our clients’ tailored needs and can do the same for you today.

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