Life Insurance FAQs

September is Life Insurance Awareness Month. If you own a life insurance policy or are thinking about purchasing one, it’s important to be educated on what life insurance can do for you and your family.

Why do I need life insurance?

There’s no replacement for you and the contribution you make to your family. You want to make sure that people in your life, especially your dependents, have financial assistance after you die.

That’s what life insurance does for you and your loved ones. It can help give you peace of mind. Life insurance can provide financial protection for your family and loved ones at a time when it is needed most.

How much life insurance do I need?

Ask yourself the following questions:

How much of the family income do I provide?
If I were to die, how would my survivors, especially my children, get by?
Does anyone else depend on me financially, such as a parent, grandparent, brother, or sister?
Do I have children for whom I would like to set aside money to finish their education in the event of my death?
Do I have family members or organizations to whom I would like to leave money?
Will there be estate taxes to pay after my death?
How will inflation affect future needs?

What are the advantages of AF™ Term Life Insurance?

Do you have kids or a mortgage? A short term policy may help with any long term financial goals in the event of your death. A term life insurance policy also offers protection without the cost of a whole life policy. You can choose from 10, 20, or 30-year term periods to fit your need! Premiums will increase during the life of the policy.

What are the advantages of AF™ Whole Life Insurance?

Permanent life insurance is insurance for your “whole” life so long as premiums are paid when due. You are guaranteed a benefit upon death or an endowment benefit at age 121.

Your permanent life insurance offers level premiums for the life of the policy with loan features and guaranteed cash value growth!

What type of policy should I buy, term or permanent?

Generally speaking, term offers the greatest coverage for the lowest initial premium and is a great solution for people with temporary needs or a limited budget. Permanent life insurance may make more sense if you anticipate a need for lifelong protection, or if the option of accumulating cash values is attractive to you. Often, a combination of term and permanent insurance is the right answer.

Read more about How to Choose Life Insurance

Can I take my life insurance coverage with me if I leave my employer?

Your AF life insurance policy is fully portable, meaning you can take your life insurance policy wherever you go, as long as you have it.

I’m only in my 20s, why do I need life insurance?

Premiums are based on the age of the applicant and rates usually increase with age. If you purchase a policy as a 20-something, it will be at a lower rate than if you wait until you’re 40. You could save money if you act now versus later. You will lock in those savings for the lifetime of your policy.

I already have life insurance through my employer. Why would I want to buy another life insurance policy?

If you become sick and are no longer able to work, your work policy may no longer cover you. And certain illnesses may prevent you from being able to secure a life insurance policy at this time. Now, when your family needs the benefit the most, they may no longer have it. Plus, many basic coverage policies will not cover everything your family needs at a time when they are ill-equipped to provide for themselves.

Learn more about why your group life insurance may not be enough

I am single with no children, so why do I need life insurance?

Even if no one depends on your income, such as a spouse or children, you should consider your debts and your burial expenses. The overall average funeral costs (including outside services, such as the burial plot, transportation, flowers, etc.) can quickly run between $10,000 to $20,000 in total.¹ Some debts would be waived with your death while others would be collected through whatever assets you left. Are your parents or other family members in a position to handle these sorts of expenses or will this create financial hardship for them?

What is an accelerated death benefit and how does it work?

This provision allows a terminally ill person to collect a portion of his or her policy’s death benefit while still alive. The money can be used to get family finances in order, pay for uncovered medical expenses, or simply do certain things for your family or friends while you still can. It’s important to note that the amount accelerated while still living, along with any premiums waived by us upon acceleration, is subtracted from the policy proceeds paid to your beneficiaries.

This blog is up to date as of September 2021 and has not been updated for changes in the law, administration or current events.