Paying For Life Insurance
Updated December 3, 2020 . AmFam Team
Having life insurance may be part of your long-term financial planning, and if you already have coverage to help secure your loved ones’ future, good for you! Sometimes, it can be difficult to understand the ins and outs of your life insurance policy — but we’re here to clear up any confusion.
Let’s take a closer look at the types of life policies available, and how paying for life insurance works for each.
Some of our DreamSecure Whole Life policies require premiums to be paid only for a limited number of years. A limited pay life policy like our Children’s Whole Life Insurance is a great idea for kids because it works in a few key ways. First, the policy contains a cash value feature, which grows tax-deferred. And secondly, the child will have a head start on coverage they may need as an adult.
And with the 10- or 20-year payment options, the policy could be paid in full before the child goes to college! Our DreamSecure Whole Life Pay to 100 Life Insurance policy guarantees level premiums — stretched out until age 100 — and it’s available to both children and adults.
How Long Do I Pay for Whole Life Insurance?
Our whole life insurance provides a set amount of coverage that lasts for your entire life. Your premiums stay the same for the entire length of your payment period. Better still, you get to choose the payment period that makes the most sense for you – which, depending on the product, may be 10 or 20 years or to a certain age, like age 100. And as long as you make all of the necessary payments and follow other policy terms, your beneficiaries will receive the death benefit whenever you pass away.
There are a variety of payment terms to choose from. Some of those choices might include:
- Pay the premium at a set rate until age 100.
- Pay the premium for a certain number of years. Keep in mind, you’ll pay higher premiums than if they were spread out throughout your lifetime, but once the payments are done, you’ll still be insured for life.
What Happens If You Don’t Pay Your Premium?
When you don’t pay your premium for a life insurance policy, your coverage can lapse — meaning you’ll no longer be covered and, in the event of death, your beneficiary will not be paid the death benefit. Typically, a life insurance company offers a grace period, which is the amount of time you have past the due date to pay your premium.
If you pay within the grace period defined in your policy, your coverage can stay in force and you won’t have to reapply for life insurance.
Paying for Your American Family Life Insurance Policy
Here’s a quick look at some of the most common ways you can pay for your life insurance policy from American Family Life Insurance Company:
Mail in a payment
You can pay quarterly, semiannually or yearly for your life insurance by mailing in your premium. For American Family Life Insurance Company policies, send your payment to:
American Family Life Insurance Company, 6000 American Parkway, Madison, WI 53783
Set up automatic payments
To pay by automatic funds transfer, contact your American Family Insurance agent (Opens in a new tab) or call our customer care center at 1-800-MYAMFAM (1-800-692-6326). Be sure to have your financial institution's information on hand.
Automatic payments are scheduled on a reoccurring basis. Payment types accepted are a checking or savings account. You choose the payment date, amount and payment method. You can change these options or stop a scheduled payment. You’ll also get an email reminder before your payment date.
You will be required to complete and sign an authorization form stating that you give American Family Insurance permission to automatically deduct funds from your account.
Pay by phone
Give us a call at 1-866-424-8002 to use our automated pay by phone system.
Make a payment with Pay Now
You can pay your bill directly from your personal checking, savings or debit/credit card account with Pay Now. You’ll need to enter your financial information, billing account details and policy information each time you make a payment using Pay Now.
Protect What Matters Most With Life Insurance
Connect with your American Family Insurance agent (Opens in a new tab)to find the life insurance coverage that best fits your needs.
This is a brief description of coverage and is subject to policy and/or rider terms and conditions which may vary by state. Fixed and guaranteed premiums are statements about the policy as determined at issue, and any changes made to a policy may affect the premium and are subject to our underwriting rules. The words lifetime, lifelong and permanent are subject to policy terms and conditions. DreamSecure Whole Life Insurance policies mature at age 121. Please check with an American Family agent for details on coverages and restrictions.
Policy Forms: ICC18-33 (10), ICC18-33 (15), ICC18-34 (20), ICC18-35 (30), L-33 (10)(ND), L-33 (15)(ND), L-34 (20)(ND), L-35 (30)(ND), L-33 (10)(SD), L-33 (15)(SD), L-34 (20)(SD), L-35 (30)(SD), ICC18-36 (10), ICC18-36 (15), ICC18-36 (20), ICC18-36 (30), L-36 (10)(ND), L-36 (15)(ND), L-36 (20)(ND), L-36 (30)(ND), L-36 (10)(SD), L-36 (15)(SD), L-36 (20)(SD), L-36 (30)(SD), ICC17-225 WL, L-225 (ND) WL, L-225 WL, ICC17-227 WL, L-227 (ND) WL, L-227 WL, ICC17-223 WL, L-223 (ND) WL, L-223 WL, ICC17-224 WL, L-224 (ND) WL, L-224 WL, ICC17-228 WL, L-228 (ND) WL, L-228 WL
Related Articles
- Life Insurance for Children
You understand the importance of providing a secure financial future for your loved ones, and purchasing a life insurance policy on a child (with the ability to transfer ownership of the policy in the future when the child becomes an adult) can help you do just that. Let’s take a look at how a life insurance policy can help you proactively protect your loved one’s financial future.
Why Is Children’s Life Insurance a Good Purchase?
A life insurance policy is a purchase that can last a lifetime. Whether you purchase it on your child or grandchild, there are a number of benefits.
Low premiums
Since the cost of life insurance depends largely on things like age and health, purchasing a life policy when they’re young can lock in a low premium for the entire policy payment term.
Protect their ability to secure life insurance in the future
One of the biggest benefits of buying life insurance on a child is protecting their ability to secure life insurance in the future. When purchasing a permanent life policy on a child, your policy might include (if not, you might have the option to add) a Guaranteed Purchase Option (GPO) benefit to ensure the opportunity to purchase additional life insurance on them at certain ages and life events down the road without a medical examination or proof of health.
Build cash value
A permanent life insurance policy has the ability to accumulate cash value year after year. The earlier you start, the longer cash value can build, so when you purchase a life insurance policy for children when they’re young, the cash value has a lot of time to grow before they may need to use it. And, if ownership has been transferred to the adult child, they can even borrow against their cash value* if needed.
Should I Purchase Permanent Children's Life Insurance?
If you’re purchasing life insurance on a child, most people select permanent life insurance since it is built to last the child’s entire life. A permanent life insurance policy provides not only a death benefit, but, as mentioned before, the policy also has living benefits, like the ability to accumulate cash value.
Purchasing life insurance can be a practical and simple way to help protect your loved ones’ dreams. Check out American Family Life Insurance Company’s DreamSecure Children’s Whole Life permanent life insurance policy to learn more. Or you can also check in with an agent — they’ll be able to answer any questions you may have about children’s life insurance options through American Family Life Insurance Company.
This is a brief description of coverage and is subject to policy and/or rider terms and conditions which may vary by state. Fixed and guaranteed premiums are statements about the policy as determined at issue, and any changes made to a policy may affect the premium and are subject to our underwriting rules. The words lifetime, lifelong and permanent are subject to policy terms and conditions. DreamSecure Whole Life Insurance policies mature at age 121. Please check with an American Family agent for details on coverages and restrictions.
*Any loans taken from your life insurance policy will accrue interest. An outstanding loan balance (loan plus interest) will be deducted from the death benefit at the time of claim or from the cash value if surrendered. If the loan balance grows too large for the cash value to support it, the policy could terminate.
Policy Forms: ICC17-223 WL, Policy Form L-223 (ND) WL, Policy Form L-223 WL, Policy Form ICC17-224 WL, Policy Form L-224 (ND) WL, Policy Form L-224 WL
- The Difference Between Annuities and Life Insurance
What’s the difference between life insurance and annuities? It’s a common question. If you wonder what it takes to secure a financial future for yourself and those you love, it may be one you find yourself asking. And that’s a very good thing.
The bottom line: life insurance can help provide your loved ones with the financial peace of mind they deserve if you were to pass away. Annuities provide a tax-deferred way to grow money and provide an income stream. Both should be considered as part of a long-term financial plan.
Although both share some similarities, the overall purpose of each is very different. Let’s take a quick look.
Life Insurance Helps Protect Their Financial Future
When comparing life insurance and annuities, the biggest difference is that life insurance is designed to help protect against a financial loss for others after your death. Annuities on the other hand help protect you financially while you’re still alive.
Life Insurance helps to financially secure your loved ones’ future, since the death benefit can help with things like replacing your income and meeting important financial needs such as:
- Funeral costs
- Daily living expenses
- Mortgage payments
- College funding
When you purchase life insurance, you aren’t purchasing it for you — it’s really a purchase for the people you want to take care of.
If you want to find the right life insurance for you and your loved ones, American Family Life Insurance Company has the customized options you're looking for. If you want to learn even more life insurance, read up on the specifics of how life insurance works.
Annuities Help Prepare You for the Future
Think of an annuity as a tool that could help meet your retirement needs. The primary purpose of annuities is to create income for you, and this can be done in a few different ways. You can set up payments that last for your entire life, a specific period of time or a combination of both.
There are many potential benefits of annuities. Some include:
- The ability to grow account value on a tax-deferred basis
- The potential for a future income stream that can’t be outlived
- The possibility of a lump sum benefit that can be paid to a surviving spouse
How do annuities work?
You can buy an annuity by giving your insurance company either a single lump sum or making payments over time. The insurance company then invests your money — referred to as a premium or purchase payment — in different ways depending on the type of annuity you select.
You can buy an annuity that begins making payments back to you right away — this is called an immediate annuity — or if you prefer, annuities are available that delay making payments to you for an extended period, sometimes many years.
Start Planning for the Future Today
Life insurance and annuities work in tandem to protect a future for yourself and those you care for. Now that you have a high-level overview, discuss with your agent how these options fit your needs.
Annuities are long-term insurance contracts intended for retirement planning. Annuities are issued by Protective Life Insurance Company located in Nashville, TN, with administrative offices at 2801 Highway 280 South, Birmingham, AL 35223, through a relationship with American Family Brokerage, Inc., 6000 American Parkway, Madison, WI 53783.
- How Often Should You Review Your Life Insurance?
When you think about why buying life insurance is important, you probably think of financially protecting your family and loved ones in your life when you pass away. With life insurance in place, you can help ensure financial support for those that matter most. But have you spent time reviewing your life policy and ensuring it still meets your needs since purchasing it?
We recommend reviewing your life insurance every year. Having the right coverage in place means less for you — and those you care for — to worry about. Because so much can happen in 12 short months, it's important to make sure your policy is right for you and your family today.
To get you started, we’ve put together a list of 9 key reasons why you should review your life insurance policies every year.
- How Cash Value Life Insurance Works
You most likely purchased life insurance for the financial protection it provides your loved ones in the event of your death — but there can be some additional benefits to life insurance. Some life insurance policies, such as DreamSecure Whole Life Insurance offers the opportunity to build “cash value,” otherwise known as a living benefit.
That living benefit is the value in your policy that may be borrowed against or paid out if the policy is surrendered before death.* Let’s take a closer look at how cash value in life insurance works.
