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In Touch With 21st - February 2014

How Life Insurance Can Help You

Do I need life insurance?

Life insurance is one of the most important purchases a person can make. While it may be unsettling to imagine a time when you will not be able to take care of your loved ones, life insurance can help. Designed to take care of others financially in the event you no longer can, life insurance can help your family pay bills, provide for a child’s education, protect a spouse’s retirement or assist aging parents by providing money directly to your beneficiaries.

Do you need life insurance?

If someone will be negatively affected by your death financially, you need life insurance. Life insurance benefits provide money to your family in the event of your passing, and there is no federal income tax on these benefits. This can help replace your income, and can assist your family with many important financial needs, such as:

• Helping pay for funeral costs and other final expenses

• Creating opportunities, such as starting a business or paying for schooling

• Offering a way to fund longer-range goals, like a college education for children or a secure retirement for a surviving spouse

Types of Life Insurance: Term vs. Whole

Term Life insurance generally offers the greatest amount of coverage for the lowest initial cost. If you have shorter-term needs and limited money to spend on insurance, a Term Life insurance policy may be the best fit for you. Policyholders generally pay a premium on a monthly or annual basis for the length of that term. Proceeds help to cover financial responsibilities that decrease or end over time, like mortgages or car loans, should something happen to the insured. With Term Life policies, premiums can increase at the end of the fixed-term period.

Whole Life insurance policies may be an ideal product for customers seeking maximum certainty with permanent, lifelong coverage. The cash value, premium requirements, and death benefit do not vary based on prevailing interest rates or market performance, and the policy owner may usually borrow against the cash value of the policy.

Where to start

With the variety of life insurance options available, figuring out the right type or how much coverage is needed is an important decision. The kind of coverage that’s right for you depends on your circumstances and financial goals. A good place to start is to visit farmers.com or talk with a Farmers representative. As a person’s needs change — whether buying a house, having children, preparing for retirement — it’s important to consult with a life insurance professional that has the knowledge and experience to help you make the right choice based on your situation.

*Life insurance issued by Farmers New World Life Insurance Company, Mercer Island, WA 98040. Products and features may not be available in all states and may vary by state.

Sources: www.farmers.com/life/term-life/; www.farmers.com/life/whole-life; lifehappens.org

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