• Term Life Insurance
• Universal Life Insurance
• Variable Universal Life Insurance
• Whole Life insurance
• Disability Insurance
• Long Term Care Insurance

Term Life Insurance

Term Life Insurance is one of the most basic forms of life insurance. It usually provides affordable protection, often with a guaranteed premium, for some period of time. If the insured should die while the policy is in force, the face amount is paid to the named beneficiary. At the end of the premium guarantee period, the insured can renew the coverage at a higher premium. The premium for term insurance is initially lower than a comparable permanent insurance policy; however, it can increase at each renewal. This initial lower premium usually makes term insurance an ideal choice for individuals with a temporary need for life insurance.

Common Types of Term Insurance

Five-Year Term: As its name implies, Five-Year Term life insurance provides life insurance protection for a period of five years. Five-Year Term can be appropriated when coverage is needed for a well-defined period of time. If the insured were to die, insurance proceeds could be used to help pay a mortgage, fund a child's education or ensure business continuation by helping to cover business expenses.

Twenty-Year Term: Twenty-Year Term is temporary life insurance protection. Premiums for a Twenty-Year Term policy are guaranteed to remain level for the first 10 years. The premium may increase in the 11th year. Premiums after the first ten years are expected to remain level through and including year 20, but are not guaranteed and can change annually.

Increasing Premium Term: Increasing Premium Term is temporary life insurance protection at an affordable initial premium. This type of policy is renewable each year, which means you may renew the policy annually (until the expiry age, which varies by state) without providing evidence of insurability, or proof of your good health. As long as you pay the premium, the policy remains in force.

Term to Age 90: As its name implies, Term to Age 90 is pure insurance protection guaranteed renewable each year until the policy owner reaches age 90. The premiums for Term to Age 90 are guaranteed to remain level in years one through ten of the policy. Beginning with the 11th year, premiums increase annually.

Universal Life Insurance

Universal life insurance provides permanent life insurance protection and access to cash values that grow tax-deferred at competitive interest rates.

Flexible Protection
Universal life products give you the flexibility to choose the amount of protection that best suits your family or business. It allows you to increase or decrease coverage as your insurance needs change. Increased coverage may be subject to underwriting requirements. You may not decrease your coverage below the required minimum. A decrease may result in a surrender charge that is applied against the policy's cash value.

Flexible Premiums
With universal life insurance, you control the amount and frequency of payments. If you are looking towards the future, you have the option to increase the premium or make lump sum contributions, subject to limits specified in the policy. The extra dollars grow tax-deferred and may increase the cash and death benefit values. On the other hand, in a temporary cash crunch, you can pay less than the scheduled premium and let the policy's accumulated cash value pay the remainder of the monthly charges.

Flexible Design
Universal life products can be customized with innovative policy features to fit your lifestyle. Contact your Allegiant Financial Advisor to learn more about how universal life policy riders can protect your spouse and children, protect your ability to pay premiums during disability and increase the benefit to your family.

Variable Universal Life Insurance

"Buy term and invest the difference." This is one of the most prevalent strategies consumers encounter when shopping for insurance. This approach involves purchasing lower cost term insurance (when compared to forms of permanent insurance) and investing the difference in growth-oriented products, such as stocks and mutual funds. For some, this makes sense, especially if the need for protection exists and you are on a tight budget.

Today, the insurance industry offers much more than just whole-life and term insurance. One such product to arrive on the scene in recent years is variable universal life insurance (VUL). VUL combines permanent insurance protection with investment flexibility.

For the purpose of this discussion, we will examine VUL and see how it compares to the traditional buy term and invest the difference philosophy.

Permanent Protection and Much More
VUL offers permanent insurance protection, usually through age 95. Simply put, this means that as long as you meet the policy costs, you are guaranteed protection. Some term insurance products periodically require proof of insurability to continue coverage. While there are term products that can cover you for life without additional requirements, their rising costs are limiting.

Additionally, while all term insurance is purchased with after-tax dollars, VUL has the potential to satisfy its policy costs with pre-tax dollars (policy's cash value accumulates on a tax-deferred basis), further strengthening the VUL strategy.

At first look, term insurance may seem attractive because you can purchase large amounts of coverage at a relatively inexpensive price. However, the cost should not be the only consideration that goes into your decision making process. For instance, consider the impact of becoming uninsurable at the end of the term period. You may save a few dollars today, but the eventual cost of uninsurability will affect your beneficiaries.

Permanent protection also offers a host of policy riders that can further enhance the effectiveness of your policy. Term insurance provides a much more limited range of riders.

Cash Value Accumulation
You can also allocate a portion of each VUL premium to one or several investment divisions, or a fixed-rate general account option. These investment divisions typically include stock, bond, balanced, international and money-market portfolios. Earnings within the investment divisions will vary with market conditions, and your principal may be at risk. Premium payments in addition to investment earnings, less policy fees and charges, serve as your policy's cash value. Usually, you can allocate as little as 1% of the premium to any of the investment divisions in a VUL policy. It should be noted that a decrease in your policy's cash value may decrease the overall amount of insurance coverage.

Term insurance has no cash value. You do have the option of "investing the difference" in growth-oriented products, like mutual funds. The value of your mutual fund account will vary with market conditions. Your principal may be at risk and, in most instances, mutual fund earnings are annually taxable. This means that you have less money working towards achieving your long term goals. Most mutual funds also require a minimum dollar amount to participate in a particular portfolio.

Investing in mutual funds is still a solid strategy to follow. But you must have the discipline to carry it out. If you neglect to put money aside for the future, the "buy term and invest the difference" strategy collapses. Without the 'invest' portion, you are left with a term policy that is incapable of accumulating funds for the future.

Meeting Today's Changing Needs
If your insurance needs change over time, VUL usually provides the flexibility to increase or decrease your amount of coverage. You can also make a lump-sum payment to increase the policy's cash value. The maximum lump-sum payment is subject to IRS limitations1. Also, should an emergency arise and you are short on cash, you may be able to skip a scheduled payment and let the accumulated cash value cover the policy's expenses. Keep in mind that the cost of insurance and administrative expenses are still incurred.

1. To increase coverage, you may need to provide satisfactory evidence of insurability or meet other applicable underwriting requirements.

With term insurance, the cost for protection is lower. However, you cannot change the policy's face amount and must meet every scheduled premium payment or risk losing the insurance protection.

As your insurance needs change, your long-term investment goals and risk-tolerance levels may also. With VUL, you have flexibility to transfer funds between the investments divisions, tax free. This gives you the freedom to make decisions based on your needs and not on the tax ramifications.

2. Many VUL policies restrict transfers from a fixed account to the investment divisions.

Tax Issues

Previously, it was noted that the earnings in VUL's investment divisions accumulate on a tax-deferred basis. By deferring current income taxes, your money benefits from the power of compounding. Most VUL policies permit policy owners to access almost all of the cash value, via a policy loan provision. Usually, policy loans are tax free but the overall amount of insurance coverage may decrease due to any outstanding loan balance.

Mutual funds are also fairly liquid investments. There are no loan privileges and withdrawals of earnings may be subject to surrender charges and current income taxes. VUL policies may also charge a surrender charge for withdrawals. In addition, the tax treatment given to funds in a VUL policy is on a first-in, first-out (FIFO) basis. This is advantageous should you wish to create a stream of income at retirement. One potential option involves receiving withdrawals until reaching your cost basis, then changing the method of withdrawals to policy loans. Partial withdrawals are at net asset value, which may be more or less than the original price. Withdrawals may be taxable and, if under age 59 1/2, may be subject to a tax penalty. Assuming the policy has been in force for at least fifteen years and remains in force through death or maturity. This arrangement would avoid a taxable event on the funds withdrawn. Remember that policy loans on withdrawals will reduce the policy's cash value and death benefit.

The tax treatment given to dollars in a mutual fund is on a last-in, first-out (LIFO) basis. This places mutual fund owners at a distinct disadvantage when trying to access account values.

3. Partial withdrawals are at net asset value, which may be more or less than the original price. Withdrawals may be taxable and, if under age 59 1/2, may be subject to a tax penalty.

4. Upon surrender, a taxable gain will be recognized to the extent that the outstanding loan basis exceeds the policy's basis.

Death Benefit Proceeds
Protecting loved ones is one of the fundamental reasons for purchasing any type of insurance. Both VUL and term insurance policies offer a death benefit. Both policies can be structured so your beneficiaries receive the proceeds estate and income tax free. Keep in mind that any portion of the 'invest' component not used in one's lifetime may be subject to both estate and income taxes. As a result, your beneficiaries may receive a lesser amount than originally anticipated.

Other Issues to Keep In Mind
In addition to the above comparisons- keep the following points in mind:

• You can use VUL's cash value as collateral when applying for a bank loan. This does not hold true for term insurance, as it does not have a cash value component.
• Generally, creditors cannot reach a permanent life insurance policy's cash value. This does not hold true for mutual funds.
• VUL's death benefit (which may include tax deferred accumulations) is free from probate. This does not hold true for mutual funds.

Make an Informed Decision
For some, the "buy term and invest the difference" philosophy is appropriate. For others, the flexibility and control of VUL may prove to be a better alternative. The key is to fully research both strategies and make a decision that best suits your needs.

Be sure to discuss your options with an Allegiant Financial Registered Representative. He or she will help you look at the big picture and recommend suitable solutions based on your objectives.
VUL policies are sold by prospectus only, which contains more complete information, including charges and expenses. You should read the prospectus carefully before you invest or send money.

Whole Life insurance

What is whole life insurance?

Whole life is permanent insurance protection that protects you for your entire life, from the day you purchase the policy until your death, as long as you pay the premiums.

Whole life can be a solid foundation upon which to build a long-term financial plan because it guarantees lifetime protection for your family or business.

What can whole life do for you?

Whole life insurance provides basic insurance protection, plus...

• Mortgage protection: Benefits can be used to help pay off mortgages and other outstanding debts in the event of a premature death.
• Estate preservation: Whole life insurance can provide funds to cover estate expenses and help avoid the need to sell assets and or borrow money to cover these expenses.
• Retirement funding: Cash values can be accessed through policy loans or surrenders to supplement a retirement income. Loans will reduce the death benefit.
• Charitable giving: A whole life insurance policy can enable you to make a significant donation to your favorite charity upon your death.
• Business needs: Whole life can be an attractive executive and employee benefit and a means to ensure a business's financial future.

A buy/sell agreement used by some companies can be funded with whole life insurance. Proceeds from a buy/sell agreement may help a company continue to operate if one of its principal dies prematurely.

Other business uses include:

• Split dollar arrangement
• Executive bonus
• Group equity carve-out
• Deferred compensation
• Salary continuation

How does whole life work?

A life insurance agent will help you determine the amount of insurance needed to adequately protect your family or business in the event of your death.

Generally after the first year, the policy begins to accumulate cash value. The amount of cash value in your policy usually increases every year. Cash values build on a tax-deferred basis. This money can be used to help purchase a home, fund a child's education, supplement retirement income, or for any other purpose. You may also choose to leave it in the policy and allow it to grow. The policy's cash value may be accessed through policy loans or withdrawals which will reduce the death benefit.

A whole life policy can earn dividends, which can fluctuate from year to year. Dividends are determined by the company's board of directors each year and are not guaranteed. When a dividend is payable, you may choose to take it in cash and use it to purchase more insurance or to pay or reduce your premiums.

After death, the company will pay your beneficiaries the death benefit, usually the face amount of the policy plus any dividend. This money is generally received by the beneficiaries free from federal income tax.

Whole life insurance means...

• Permanent protection that can never be canceled as long as you pay your premiums.
• A level premium that is guaranteed never to increase.
• A guaranteed death benefit, generally free from federal income tax.
• Tax-deferred cash value accumulation.

Long Term Care Insurance

We spend our lifetime working hard and saving for the future to ensure our security and the security of our family. For peace of mind, protect your most important assets with insurance.

We buy property insurance on our homes and automobiles. We purchase disability income, life and health insurance to protect ourselves and those who depend on us financially.

It's important to think in terms of the "quality" of a longer life. When it comes to the quality of our lives, maintaining control over our own circumstances will become more and more meaningful with every passing year.

We cannot predict the future, but we may eventually need care services on a long-term basis. The cost of receiving these services can jeopardize not only our lifestyles, but also the financial security we've spent our lifetime establishing.

Long Term Care Insurance provides you with an insurance policy designed to fund your long term medical needs in the event you lose your ability to perform everyday activities.

Understanding Long-Term Care

Introduction

Improved medical care combined with better nutrition and a more active lifestyle results in longer and healthier lives. While it is encouraging, an extended life brings with it the increased likelihood of experiencing a long-term illness. To effectively preserve our freedom of choice for tomorrow means one must carefully consider the options of today. How well you protect your assets could have much to do with the future happiness and material security of your family.

• What is long-term care?
• How is Long-Term Care Different from other Medical Care?
• When will someone need care?
• What Can I Do To Protect Against a Long-Term Care Need?

What is long-term care?
Long-term care refers to a broad range of services available to individuals who have lost some level of independence and need help with daily activities. This assistance is often the result of a chronic illness.

How is Long-Term Care Different from other Medical Care?
Rehabilitative medical care due to acute conditions is different from long-term care. When medical care is the result of a short-term medical condition, a hospital stay is often necessary to help stabilize the condition. If patients have not made a full recovery, they are normally discharged to the care of a nursing facility, or to professional home care. With these types of conditions, Medicare (for qualifying individuals) or private-pay health insurance will usually pay for rehabilitative care.

When will someone need care?

There is no single way to identify when or if someone will need long-term care. Every case is different due to the type of illness or injury, who can provide the necessary care and the financial resources available. Understanding the types of illnesses and injuries that create the need for long-term care is important. A chronically ill person generally has a physical or cognitive impairment.

Physical Impairment
Activities of daily living (ADLs) are the most common measurement for physical ability. The ADL's requiring assistance typically occur in a specific order as depicted in the continuum model below:

Bathing→Dressing→Toileting→Transferring→Continence→Eating

Least Impaired Person→ → → → →Most Impaired Person

When assistance is needed with ADLs, some individuals may simply require that a health care practitioner remain within arm's reach, to ensure that the activity is completed safely. This is referred to as standby assistance. As the patients’ needs increase, someone may be needed to assist with the completion of that activity. This is referred to hands on assistance.

Cognitive Impairment

When a cognitive impairment exists, individuals are frequently able to complete the physical activities, but may not remember how or when to complete them. This level of impairment is usually segmented into three categories:

Short or long-term memory
Orientation as to person, place or time and deductive or abstract reasoning

This situation tends to require intervention by a third party to ensure that the activities are completed safely. Common examples of a cognitive impairment are Alzheimer’s disease, senility, or dementia.

What Can I Do To Protect Against a Long-Term Care Need?

Maintaining a healthy lifestyle and receiving annual check-ups at your doctor's office are effective ways of minimizing that risk. However, even these steps can not eliminate a long-term care event from happening to otherwise healthy people, nor can they prevent the normal effects of aging.

By working with a knowledgeable and trusted Allegiant Financial Agent, you can learn how long-term care insurance may help protect you against the costs of long-term care. Todays long-term care insurance policies offer freedom of choice when it's needed most -- and at a fraction of the cost which might be incurred when paying out-of-pocket.

Disability Insurance

A high quality Disability Insurance product covers the total or partial disability of professionals, business executives, small business owners and others.

Disability Insurance protects your most valuable asset, your ability to earn an income. A long-term disability could suspend or terminate your income for an extended period of time. It may force you to close your business.

Individual Disability Insurance

Individual Disability Insurance is purchased by an individual to protect his or her ability to earn an income.

Disability Income

Disability Income Insurance replaces a portion of earned income lost due to a total or partial disability.

Interim Term

Interim Term Disability Insurance provides temporary coverage until an employee qualifies for employer-sponsored disability coverage.

Disability Overhead Expense

Disability Overhead Expense reimburses a business owner for covered overhead expenses of his or her business that continue during a period of partial or total disability.