Life Insurance

Life Insurance

In the following, we provide a very general overview of the types of life insurance products that are offered in the marketplace. Each of these products is offered in some form by ALICO through its branches and subsidiaries.

What is life insurance?

A Life insurance policy is a contract between you (the policyowner-insured) and an insurance company (the insurer). Under the terms of a life insurance contract, the insurer promises to pay a certain amount of money (death benefit) to someone you choose (a beneficiary) when you die, in exchange for your premium payments.

Do you need life insurance?

The need for life insurance is simple; you should consider life insurance if anyone depends on your income. Essentially, you transfer the risk (loss of your income) to the insurer by paying a fee, or "premium," to the insurer. The insurer, with a large capital base and expertise in risk selection and management, is better able to accept this risk than any single individual would be.

This risk transfer may be helpful in both personal and business situations.

Personal needs:

- Dependent's Support: The major reason people buy life insurance is to replace income that would be lost because of the death of an income earner. If you support or help support a family, the loss of income that would result from your death could mean that your surviving dependents may face financial difficulties. Household expenses continue, utility bills and school fees must be paid, and food and clothing must be purchased. Life insurance provides you with a sense of security in the knowledge that the life insurance money will be available to help support family members in case of your death.

- Education Costs: One of your primary objectives may be to send your children to a university or college. Due to an untimely death, the tuition may become beyond your family's reach. Life insurance may be used to provide for the tuition expense.

- Burial expenses and estate planning: Life insurance may be used to pay funeral or burial expenses. In addition, it may be used to pay inheritance taxes.

- Investment Income: Life insurance policies that accumulate savings can also be used as vehicles for