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Most people wouldn't think of buying life insurance to protect their home, just as they wouldn't think of
buying homeowner's insurance to protect their life. However, life insurance can play an important role,
providing the funds to pay your mortgage when you need money most.
Homeowner's insurance is essential and can pay damages or replacement costs in case of fire, water
damage, lightning and other potential disasters. It cannot, however, protect you against foreclosure.
That's where life insurance comes in. What would happen to your home if the breadwinner in your family
were to pass away? Could you continue to make your mortgage payments?
A life insurance policy can be designed not only to replace the income of the person being insured, but to
provide funds for specific needs, such as paying a mortgage, homeowner's insurance premiums and
property taxes. If you purchase a cash-value policy, you can also borrow against the cash that builds up in
the policy, which could provide you with funds to make mortgage payments during difficult times.
Loans and partial withdrawals sometimes may be made after the first year of the policy and can be repaid
at any time during the life of the policy. Borrowing on the policy may be subject to restrictions, will reduce
the policy's account value and death benefit, and care must be taken to ensure that loans do not cause the
policy to lapse. There also may be penalties and fees associated with the use of loans and withdrawal and
surrender charges may apply. Loans are not subject to income tax while the policy is in force.
As this example shows, life insurance can serve many purposes.
This column reflects the opinions of Timothy P. May. Before acting on this or any other advice, check with
your own financial advisor. Timothy P. May, CHCF is a registered representative with John Hancock's
Westborough Massachusetts Branch Office, AspenCross Financial Group, One Technology Drive,
Westborough, MA 01581 and can be reached at 1-800-530-6635, ext. 190 or
tmay.aspencross@jhnetwork.com.
This material is for informational purposes only. Although many of the topics presented may involve tax,
legal, accounting or other issues, neither John Hancock Life Insurance Company and its affiliated
companies, nor any of its agents, employees, or registered representatives are in the business of offering
such advice. Individual interested in these topics should consult with their own professional advisors to
examine tax, legal, accounting or financial planning aspects of these topics.
buying homeowner's insurance to protect their life. However, life insurance can play an important role,
providing the funds to pay your mortgage when you need money most.
Homeowner's insurance is essential and can pay damages or replacement costs in case of fire, water
damage, lightning and other potential disasters. It cannot, however, protect you against foreclosure.
That's where life insurance comes in. What would happen to your home if the breadwinner in your family
were to pass away? Could you continue to make your mortgage payments?
A life insurance policy can be designed not only to replace the income of the person being insured, but to
provide funds for specific needs, such as paying a mortgage, homeowner's insurance premiums and
property taxes. If you purchase a cash-value policy, you can also borrow against the cash that builds up in
the policy, which could provide you with funds to make mortgage payments during difficult times.
Loans and partial withdrawals sometimes may be made after the first year of the policy and can be repaid
at any time during the life of the policy. Borrowing on the policy may be subject to restrictions, will reduce
the policy's account value and death benefit, and care must be taken to ensure that loans do not cause the
policy to lapse. There also may be penalties and fees associated with the use of loans and withdrawal and
surrender charges may apply. Loans are not subject to income tax while the policy is in force.
As this example shows, life insurance can serve many purposes.
This column reflects the opinions of Timothy P. May. Before acting on this or any other advice, check with
your own financial advisor. Timothy P. May, CHCF is a registered representative with John Hancock's
Westborough Massachusetts Branch Office, AspenCross Financial Group, One Technology Drive,
Westborough, MA 01581 and can be reached at 1-800-530-6635, ext. 190 or
tmay.aspencross@jhnetwork.com.
This material is for informational purposes only. Although many of the topics presented may involve tax,
legal, accounting or other issues, neither John Hancock Life Insurance Company and its affiliated
companies, nor any of its agents, employees, or registered representatives are in the business of offering
such advice. Individual interested in these topics should consult with their own professional advisors to
examine tax, legal, accounting or financial planning aspects of these topics.
LIFE INSURANCE IS ALSO HOME INSURANCE |
| Written by Timothy P May. All Rights Reserved. Published September 2007 by The Homesteader - York County & Lancaster County, South Carolina, Edition. |
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