Life Insurance Transfers Risk

Angie asks what happens to the money she gives each month to a 30-year term life insurance policy. Is she throwing her money away?

QUESTION: Angie on Facebook asks what happens to the money she gives each month to a 30-year term life insurance policy. Is she throwing her money away?

ANSWER: You didn’t ask that about your homeowner’s policy or your car insurance policy. What happens if you pay homeowner’s for 30 years and your house never burns? Did you throw your money away? No, you did not. You were purchasing the transfer of risk in the event something bad happened. Term life insurance is the same way. You’re purchasing the transfer of risk. If something bad happens, your family will have money to use to replace your income.

You never buy whole life, cash value, universal life insurance ever. You always go to zanderinsurance.com and get an inexpensive term quote and do your investing anywhere except inside a rip-off life insurance policy.