Life insurance is a contract signed by both parties (insured and insurer) which stipulates the amount with which you will have to answer the insurer, if so required, the premium to be paid by the insured and the details of the contracted service, in order to generate a capitalization free of taxes that can be used in two ways, as a method of protection and/or as a method of saving.
In order to take out life insurance is to protect economically to the insured and their beneficiaries in the event of a misfortune happens at the same and/or generate a capital over the long term.

Method of protection

With regard to the protection life insurance provides compensation to the beneficiaries in case of accidental death, terminal illness, disease that prevents continue with proactive life insured and/or physical impairment, which directly affects the life of the insured. Proactive Such compensation shall be made as long as the insured is up to date with the premium to be paid and it is shown that the imponderables previously happen accidentally, and be verifiable, to avoid fraud affecting economically to the insurer.

Saving Method

In this mode the contract signed by both parties has a “maturity” that can vary between 10 and 20, 15 years. In that period the insured generates a capital in their favor. Once that period has expired the insured will receive compensation in life.


The premium is the amount to be paid by the insured to access the benefits of life insurance contracted. The same is directly affected by the following variants:

The age of the insured.

If you have had or have any disease.

If you take any medication prescribed chronic.

If you have had or have any addiction. In the event that you have had, the duration of the Hague abandoned.

The insured amount.

The number of beneficiaries.

Their work (if is high risk and/or unhealthy).

Your income.


Legal standpoint

In the United States of America the premium paid by the insured will not be tax deductible, because that way, you can avoid the tax fraud and in terms of the compensation that provides the insurer will not be affected by any federal or state tax.

However, such compensation shall be entitled as a world heritage site of the insured and this way if can be affected by state taxes on assets and/or inheritance.

All the details featured above are tied to state laws at the time, in the case of modification of the same, will be directly affected.
Possible uses of compensation.

The compensation provided by the contracted life insurance can be used to cover all types of debts, such as for example a mortgage arrears, bank debt and/or debts to private entities as may be a vehicle brought to pay.

It can also be used to cover funeral expenses in case of death of the insured, the cost of the succession of property, use it as an educational fund for their descendants and/or to make donations to charity. In the event that life insurance is used as a method of saving and thus benefit from the compensation in life, it is a good complement economic development in case of having reached retirement age, ensuring the well-being of both the insured as your family since at that time will not have a fixed job for having reached the stage not active in your life.

Even though the life insurance isn’t compulsory in the USA, it’s of the utmost importance to take this into consideration. In everyday life we see always accidents, like traffic accidents where we see in several events motorcycle drivers who die or depart severely hurt which frequently causes a handicap that could stop continue with his busy life normally.

In addition, we see injuries in structures and natural disasters, which frequently lead to landslides and several wounded and a lot seriously. Additionally the instances of assaults where the injured individual is quite terrible wound or straight may lead to death.

Since these instances there are many where suffer misfortunes that impede the progression of the busy life of someone. In one of these instances, so the hardship leading to a disability or death, life insurance protects and indemnifies the beneficiaries designated in the coverage from the insured, making sure that the well-being of these persons until they can adapt to the circumstance.