Best Life Insurance Companies in Phoenix

Frequently Asked Questions

• Are life insurance benefits guaranteed even if the insurance company in Phoenix goes out of business?

  Yes, all life insurance benefits are guaranteed by the Arizona Life and Disability Insurance Guaranty Fund up to a certain limit. The guaranty fund provides up to $300,000 in death benefits and $100,000 in cash value component regardless if the coverage is above this amount. To be able to be eligible for this benefit if the insurer goes out of business, the policyholder in Phoenix must have been up-to-date with the payments and the insurer must have been licensed in the state.

• In Phoenix, how many days is the grace period for being unable to pay premiums on time?

  Policyholders in Phoenix are given a 30-day grace period after the due date of each premium, with the exception of the first payment. Within this period, they must pay the lapsed premium to avoid termination of the coverage. However, their benefits could be reduced if they file a claim before they can keep their payments updated.

• What is a cash value component in whole life insurance in Phoenix?

  A cash value component in whole life insurance is the amount paid by the insurer should the policyholder choose to surrender the policy. Policyholders in Phoenix can surrender their insurance if they give up future death benefits. The amount of the cash value component is usually the total payments made minus the fees imposed by the insurer. It is lower than the death benefits.

• Can you sell an annuity in Phoenix?

  In Phoenix, you can legally sell an annuity as a whole or just a portion without any court approval. However, annuities obtained from settling a lawsuit need approval from the court. In addition, be aware of the tax implications of selling an annuity. If you receive a lump sum payment from the sale, it will generally be treated as income and, therefore, subject to taxation.

• Can an employer benefits package in Phoenix be enough coverage for life insurance?

  It depends on your needs. Group life insurance as part of the employer benefits package provides a smaller amount of coverage. The policy amount is typically up to three times your salary. Should this be insufficient for your needs, you can get another life insurance. This can also provide you coverage if you lose your group insurance when you change jobs in Phoenix.

• Which is better, term or whole life insurance?

  Life insurance is a personal financial tool, so the right type of insurance for you depends on your goals and current situation. One of the main differences between term life insurance and whole life insurance is that term life insurance only covers you for a set period of time. Once you meet the premium payment requirements on a whole life plan, it covers you for the rest of your life. Whole life insurance also builds cash value, making it a potential investment. But whole life insurance is typically much more expensive than term life insurance.

• How much life insurance do I need?

  A common recommendation is purchasing life insurance that is equal to five times your current salary, or more. But you can also estimate how much life insurance you need by adding up your debts, annual expenses for dependents multiplied by the years you want to ensure support, and any other items you wish to cover, such as a future wedding or college tuition.