Many individuals and their financial planners consider life insurance as the cornerstone of their financial plan. While the main purpose of life insurance is to help take care of your family in the event of your death, policies can also serve other purposes including:
- providing funds to pay final expenses
- creating an inheritance for your heirs
- making charitable contributions in the event of your death
- creating a source of tax-deferred savings1
Term life insurance provides coverage for a fixed period of time and typically may be renewed after the initial contract term expires. Term insurance is typically the least expensive and simplest type of coverage, but does not provide savings. The premiums are lowest when you are young and increase upon renewal as you age. American General Life Companies (American General) insurers sell Term Insurance for one, five, 10, 15, 20 or 30 years and AG Select-a-Term which gives you a choice of 10-, 12-, or 15- through 30-year terms of life insurance coverage.
Permanent life insurance provides coverage for an indefinite period of time. Whole life insurance premiums remain at a fixed level for the duration of the policy while universal life offers flexible premiums. Over time, the policy generally builds up cash value on a tax-deferred basis. American General insurance companies sell five different types of permanent insurance:
1Based on current federal income tax laws.
The underwriting risks, financial obligations and support functions associated with the products issued by American General Life and Accident Insurance Company (AGL) and The United States Life Insurance Company in the City of New York (USL) are the issuing insurer's responsibility. American General Life Companies, www.americangeneral.com, is the marketing name for the insurance companies and affiliates comprising the domestic life operations of American International Group, Inc., including American General Life and United States Life. United States Life is authorized to conduct insurance business in the state of New York. Policies and riders not available in all states.