Insurance and Finance

5 Answers to Your Life Insurance Questions

By Staci Parks 3.23.20

Life insurance can be a tough topic to talk about — but it’s necessary. The why is simple: In your absence, life insurance can help financially protect your family by replacing income and covering debts ranging from funeral costs to basic living expenses. 

Texas Farm Bureau Insurance’s Dana Schneider, an agency manager in Perryton, helps make the conversation a little easier by sharing the top-five frequently asked questions her policyholders have when it comes to life insurance.

Q: What is the difference between term life insurance and whole life insurance?

A: Term life insurance is like renting a house. There is no equity. There will be an expiration date, much like an end to a lease. But it provides you with valuable coverage for the time being. Whole life policies build cash, may pay dividends, and provide guaranteed protection past age 100 for as long as you continue the policy.

Q: Am I too old to qualify for life insurance?

A: There is a need for life insurance in virtually every stage of life, ranging from newborns to newly married 20-somethings starting a family to empty nesters looking toward retirement. Your need for a term life policy may expire, but as long as you’re still insurable, you can apply for whole life insurance up until your 80th birthday.

Q: Can my rate improve on my term life insurance policy?

A: Yes. It’s possible to lower your term life insurance premium with lifestyle changes such as quitting smoking and/or smokeless tobacco or getting medical conditions under control through weight loss or medication. Depending on the situation, policyholders can apply for a better rate within one to two years. Once it’s re-underwritten, the new rate is applied to your existing policies with Southern Farm Bureau Insurance.

Q: Do beneficiaries pay taxes on life insurance money?

A: No. Proceeds from a life insurance policy are generally not considered taxable income, so the beneficiary on the policy would not be required to pay taxes on it.

Q: Why would I buy a life insurance policy for my child?

A: It’s a good idea for several reasons: Whole life insurance is a permanent policy that will last for the child’s entire life. It earns cash value. And with a Guaranteed Insurability Rider, Southern Farm Bureau Insurance guarantees to offer the child additional insurance in the future regardless of any changes in health.

Don’t put off this important task any longer. Help protect your loved ones and get a quote for a life insurance policy today.

Coverage and discounts are subject to qualifications and policy terms and may vary by situation. Life insurance products are offered through Southern Farm Bureau Insurance Company. © 2020 Texas Farm Bureau Insurance