Term insurance is designed to provide a pure death benefit to a beneficiary upon the death of the insured. Typically, term insurance is the most inexpensive policies and does not offer any living benefits.
Cash Value Insurance
Cash value insurance, known as whole life or permanent insurance, is also designed to provide a death benefit but has cash accumulation as well. This policy will charge a higher premium, but offers living benefits to the owner of the policy.
There are a variety of cash value policies available for a licensed agent to sell, such as Universal life, Variable life, Variable Universal life and Equity Index Universal life. These are policies that provide guaranteed and nonguaranteed values in addition to death benefits. All variable insurance policies may require additional state licensing and will require a securities registration.
An annuity is a financial product that also requires an individual to obtain a life insurance license to sell. Even though many financial advisors and banks offer annuities, they are funded by life insurance companies. An annuity is not designed to provide death benefits, but rather living benefits in the form of income. Primarily, and annuity will be used to supplement retirement income and can guarantee payments for the life of an annuitant.
A financial plan is an evaluation of someone’s current and future finances. The financial planning process involves estimating the cash needs of an individual and setting goals to meet retirement and estate planning needs. Life insurance and related financial products play in integral part in creating this financial plan.
Becoming a Life Insurance Agent
To become licensed, you will need to demonstrate minimal knowledge of these products, as well as general insurance and contract concepts, policy provisions and applicable riders, the application and underwriting process, basic retirement plan characteristics and federal taxation. Additionally, there are state specific topics you will need to know. All A.D. Banker learning solutions will deliver the content needed to successfully complete the education requirements for licensing. Now is the time to become a life insurance agent!