Life Insurance: Geico's Offer And Your Options

Life insurance is a contract in which a policyholder pays premiums in exchange for a lump-sum death benefit paid to their beneficiaries when they pass away or after a specific amount of time. GEICO Insurance Agency, LLC has partnered with other companies to offer affordable life insurance options to meet your family's needs. GEICO offers term life insurance and whole life insurance. Term life insurance provides coverage for a specific time period, usually 5 to 30 years, and is the most affordable and straightforward type of life insurance. Whole life insurance, on the other hand, provides coverage for the entire life of the insured and may include additional cash value. GEICO helps customers find the right life insurance policy by taking into account their specific needs, financial goals, and budget.

GEICO's partners and policies

GEICO has partnered with Fidelity Life Association, eFinancial, LLC, Life Quotes, Inc., and Ladder Insurance Services, LLC to offer life insurance. These companies are not owned by GEICO Insurance Agency LLC, but GEICO customers can still access life insurance through them.

GEICO offers term life insurance, whole life insurance, and universal life insurance. Term life insurance is the most affordable and easiest to understand, with straightforward paperwork and no complicated processes. It covers a specific time period, usually 5, 10, 15, 20, or 30 years, and provides financial help to the beneficiary in the form of a lump-sum death benefit. The premiums are level and guaranteed not to increase, and the policy cannot be cancelled as long as premiums are paid on time. If the policy term ends and the insured is still alive, they can choose to start a new policy or continue the current one with rates reflecting their current health, age, and lifestyle. GEICO recommends that each family income provider carries no less than ten times their annual income/worth in life insurance.

Whole life insurance covers the life of the insured person and pays a predetermined amount to the beneficiary when the insured dies. The premiums are consistent throughout, and part of them may be invested and provide additional cash value. The insured may be able to take out a loan against the policy.

Universal life insurance also covers the insured's lifetime and offers an optional fund that the insured can contribute to. The side cash fund can build over time, but premiums can fluctuate.

Term life insurance

The GEICO Insurance Agency recommends that each family income provider carries no less than ten times their annual income/worth in life insurance. The amount of coverage should also take into account factors such as final expenses, including funeral expenses, medical bills, and taxes, as well as existing loans, debts, and mortgages. Additionally, it's important to consider future expenses such as children's or dependents' college costs.

Compared to whole life insurance, term life insurance is generally a less expensive option. This is because term policies are for a set time period and a fixed amount. If the insured person is still alive at the end of the policy period, the policy expires and has no value.

Whole life insurance

When deciding how much whole life insurance to purchase, it's important to consider the financial needs of those who will be left behind. This may include providing financial support for children until they turn 18 or graduate from college, as well as college expenses, outstanding debts, and estate planning.

The cost of a whole life policy is based on the amount of the death benefit and the insured's age, medical history, lifestyle, and other factors. It's important to note that whole life insurance is generally more expensive than term life insurance, as it covers the insured's entire lifetime.

GEICO Insurance Agency, LLC, has partnered with other companies to offer affordable whole life insurance options to meet the diverse needs of its customers.

Universal life insurance

The flexibility of universal life insurance means that policyholders can lower or skip payments if there is enough cash value. However, if the cash value is too low, the policyholder will have to make large payments to keep the policy active. If the cash value falls to zero and the premiums do not cover the COI, the policy will lapse. The cash value can be used for anything, such as emergencies, home repairs, college tuition, or business investments, and is usually tax-free.

Upon the death of the policyholder, the beneficiary will receive the death benefit, and the insurance company will keep the remaining cash value. The death benefit will be lower if the policyholder withdrew from or borrowed against the cash value.

Calculating life insurance needs

GEICO offers life insurance and has teamed up with partners to provide affordable life insurance options to meet your family's needs.

The amount of life insurance coverage you need depends on several factors, including your family's financial situation, your age, and your life stage. It's important to consider your financial obligations, dependents' needs, and long-term goals when determining your coverage amount. Here are some key factors to help you calculate your life insurance needs:

• Income replacement: One of the primary purposes of life insurance is to replace lost income for your dependents. A common rule of thumb is to multiply your annual income by 7 to 10, or even by the number of years until your retirement, to ensure your loved ones receive a sufficient death benefit.
• Outstanding debts: Consider any debts or loans you have, such as a mortgage, student loans, or car loans. You may want your life insurance to cover these expenses so that your loved ones aren't burdened by them.
• Future expenses: If you have children, you may want to include future college expenses in your life insurance calculation. You may also want to leave behind an inheritance or make a financial gift to a charity.
• Final expenses: Life insurance can help cover burial costs and other end-of-life expenses, ensuring your family isn't left with these financial burdens.
• Current assets: If you have significant savings or investment funds, you may not need as much life insurance coverage. Assess your current financial situation and consider how much your beneficiaries will need in your absence.
• Number of dependents: Think about the number of people who rely on your financial support. This includes your spouse, children, or anyone else who depends on your income.
• Other financial goals: Consider any other financial goals or dreams you want to fulfil, such as helping your children buy their first home or starting a college fund for your grandchildren.

While there are online calculators available to estimate your life insurance needs, it's always a good idea to consult a financial advisor or insurance agent to determine the right coverage amount for your unique situation. They can help you navigate the different types of life insurance policies, such as term life insurance, whole life insurance, and universal life insurance, and choose the one that best suits your needs.

Frequently asked questions