Whole Life Insurance for Asian-Indians

We all have different financial needs and objectives. But life insurance plays a fundamental role in most of our plans for financial security. That's because of the variety of life insurance plans available and the many ways they can be customized to meet unique needs at different periods of your life.

Whole life insurance is permanent insurance protection that protects you for your whole life, from the day you purchase the policy until you die, 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 assure 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 principals 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 an 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, use it to purchase more insurance or to pay or reduce your premiums.

When you die, 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.
  • The potential to earn dividends. (Dividends are based on the policies applicable to dividend scale or interest crediting rate which is neither guaranteed nor an estimate of future performance.)

  • Did You Know...?
    Because New York Life is a mutual company, it is owned by its policyowners. When you purchase a whole life policy from us, you, in effect, own a piece of the company and are eligible to receive dividends and participate in the election of the company's board of directors.

    For generations, families have relied on the essential financial security that Whole Life insurance provides. In addition to paying a death benefit, Whole Life is also a value builder. The cash values that accumulate in the policy can be accessed during your lifetime to fund vital needs such as a child's education or a new home. Whole Life is a flexible product that can be customized to meet your family's unique needs. It can provide a foundation upon which you can help build your family's financial future.

Benefits

  • A guaranteed death benefit, generally free from federal income tax.
  • Tax-deferred cash value accumulation.
  • Generally, the ability to borrow from cash value on a tax-free basis.1
  • A level premium that is guaranteed never to increase for life.
  • Permanent coverage that can never be canceled, provided that premiums are paid when due.
  • Eligibility to earn dividends as declared by the Company.2
  • The ability to customize the plan by adding optional riders.

Uses of Whole Life
Individual - Whole Life can be an effective method of protecting your family's assets. Some potential uses include:
  • The 412(i) Plan - Note: the 412(i) plan is currently available in the following jurisdictions: AZ, AR, CO, DE, DC, FL, GA, ID, IN, KS, MI, MS, MO, NH, OH, SD, VT, WV and WY. Retirement Planning Advantages for the Well-Established Business Owner. The 412(i) plan is a tax-qualified, defined benefit pension plan for business owners and their employees that must be funded with a combination of life insurance and annuities, or annuities alone.3 The guarantees of the 412(i) plan are derived from the life insurance and/or annuity contracts that fund it and are dependent on the claims paying ability of the issuing life insurer. Therefore, it's essential to choose a reputable life insurance company with superior financial strength.**
  • Traditional Insurance Protection - Provides the financial security that gives families the peace of mind they deserve.
  • Mortgage Protection - Can help pay off mortgages and other outstanding debts in the event of a premature death.
  • Retirement Funding - Over the long term, accumulated cash value can be accessed through policy loans1 or surrenders to help supplement a retirement income.
  • Education Funding - Help pay for children's and grandchildren's education through policy loans1, or as named beneficiaries.
  • Pension Maximization - A possible solution to the pension dilemma, whereby a "single-life" pension option is chosen and life insurance proceeds are earmarked to replace the lost pension benefit in the event of pensioner's death.
  • Estate Planning Tool - Whole Life insurance can be an effective way of providing funds for estate expenses, and to help avoid the sale of assets and/or the need to borrow.
  • Charitable Giving - Bequeathing life insurance is an effective way to make a significant donation to your favorite charity.

1 Loans against your policy accrue interest at the current rate and decrease the death benefit by the amount of the outstanding loan and interest.
2 Dividends are based on the policy's applicable dividend scale or interest crediting rate which is neither guaranteed nor an estimate of future performance.
3 In addition to other tax-qualified rules, the Internal Revenue Code imposes limits on the amount of life insurance that can be purchased in a qualified retirement plan. As a result, a 412(i) plan cannot be funded solely by life insurance. Also, loans are not permitted under a 412(i) plan, and any forfeitures under the plan and dividends paid by the insurer will be used solely to reduce future premiums. (Dividends are not guaranteed, nor are current dividends an estimate of future performance.)

* This material is being provided for informational purposes only. Neither New York Life nor any of its agents provide legal, tax or accounting advice. Please contact your own advisors for legal, tax and accounting advice.
** New York Life and its subsidiary, New York Life Insurance and Annuity Corporation, have received among the highest ratings from four major rating services as indicated below: Moody's: Aaa
A.M. Best: A++
Standard & Poor's: AA+
Fitch: AAA
Source: 2003 Third Party Rating Reports (as of 10/15/2003)

Issued by New York Life Insurance Company, 51 Madison Avenue, New York, NY 10010.

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Whole Life Insurance for Asian-Indians
 

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