The Walters Agency Podcast

Beyond Death: How Life Insurance Creates Security for Your Loved Ones

• Timothy Walters • Episode 7

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What Is Life Insurance And Why Should You Have It?

Death is inevitable. Financial hardship for your loved ones doesn't have to be.
Timothy Walters dives deep into the world of life insurance, offering a refreshingly honest look at a subject many people avoid discussing. Drawing from his decade of experience helping families through the claims process, Timothy explains why life insurance isn't really for you—it's the ultimate gift for those you leave behind.

The podcast explores a common misconception: that life insurance is only necessary for married people with children. Timothy shares his personal choice to maintain coverage despite being single without kids, understanding there are still people he'd want to provide for after his passing. He recounts the emotional yet rewarding experience of handling his first death claim, where a widow with limited job prospects was able to maintain financial stability following her husband's death because he had planned ahead.

Most Americans are unprepared for the staggering costs associated with death. With basic burial expenses approaching $10,000 and cremation still costing thousands, final expense policies provide essential protection for families. Timothy breaks down the critical differences between term and whole life insurance, explaining how term policies offer significant coverage at lower costs for specific timeframes, while whole life provides permanent protection with the added benefit of cash value accumulation that typically outpaces traditional savings accounts.

The message is clear: the best time to secure coverage was yesterday; the second-best time is today. Whether you're looking to protect your family through their growing years or leave a lasting financial legacy, understanding your options is the first step toward peace of mind. Ready to explore how life insurance fits into your financial plan? Contact The Walters Agency for a complimentary consultation and discover how affordable protecting your loved ones can be.

To learn more about The Walters Agency visit:
https://www.brightway.com/agencies/tn/knoxville/0237/team
The Walters Agency
7009 Asheville Hwy
Knoxville, TN 37924
423-417-2070

Speaker 1:

Welcome to the Walters Agency podcast, where insurance meets peace of mind. Hosted by licensed insurance agent and owner, timothy Walters, we're here to help families, homeowners and small business owners throughout East Tennessee protect what matters most Our mission creating win-win-win solutions for insurance. Let's dive in.

Speaker 2:

You might not need life insurance for you, but your loved ones will. Timothy Walter explains why life insurance is one of the most important policies you can have. Welcome back everyone, skip Monaco, else slash. Producer. Back in the studio with Timothy Walters. Licensed insurance agent and owner of the Walters agency. Timothy, how's it going, man?

Speaker 3:

Man, I'm walking and talking, man Can't beat it, can't beat it.

Speaker 2:

That's very good, very good. Well, something that's been on my mind lately is life insurance, and you know there's a lot of people that don't even know exactly what that is and the different types of life insurance. So I wanted to ask what is life insurance exactly and why should you have it?

Speaker 3:

Well, that's a great question. Well, that's a great question. And insurance, if I was going to define it, I would say it's security for your loved ones when you're gone. You know, most of us even even guys like me like I've not never been married, no kids, and I do have life insurance, because there's still people that if I you know, if I went out here and got creamed by a bus and exited this world in a spectacular fashion like that there's people that I would like to leave something, to leave some security to.

Speaker 3:

And life insurance is one of those things where I don't care how wealthy you are or how poor you think you are financially, it's something you should at least consider, you should look into, you should educate yourself about it, because it can make an incredible difference in people's lives. I've seen it. I've been doing life insurance since 2012. I think I remember doing my first death claim my first year back when I was with State Farm, Helped take care of a death claim and that was tough, but it was also good, because the person who we filed the claim for he was the primary breadwinner of his family and his wife did not have a full-time job. She met a stay-at-home mom. For most of their relationship she'd been a stay-at-home mom for most of their relationship. She had no way to really enter the job force and have the same kind of earning power that her husband had.

Speaker 1:

And if he hadn't?

Speaker 3:

had a solid life insurance policy, she and her kids would have been in a difficult position. They may not have been able to pay their mortgage. They may not have been able to pay their bills and even if they had, they still would have been able to pay their mortgage. They may not have been able to pay their bills and even if they had, they still would have been financially stressed. And most of us at some point in time in our life have been financially stressed. And it's hard. It creates all kinds of difficulties. It can cascade into your relationships with people. It's not fun. But because he planned ahead and he set that there for his, his family, they were able to stay on their feet and yes, it's a terrible thing, they had to grieve their loss. I'm sure it was awful, but they weren't dealing with that bereavement and then staring down the barrel of financial catastrophe. You know and that's.

Speaker 3:

That's a big deal, uh, huge. I've seen where older folks you know have their. These policies are called final expense policies. They're smaller typically 10 or $15,000 maybe, Um, and they're sold specifically to folks over a certain age, basically to help cover burial expenses. Burial to die in this country is expensive. I don't even know what it is now. Back when I last time I read, it was almost $10,000 on the low end to get buried and a lot of people don't think about that. I've literally had people say, well, I'm going to have my family chuck me in the ground.

Speaker 3:

I've literally had people say well, I'm going to have my family chuck me in the ground.

Speaker 3:

Well, I mean, that's fine but, unfortunately, it's illegal on your own land in a lot of cases anymore, so leaving that expense $10,000, $15,000 to your survivors most people, I think, when they think about it, don't want to do that.

Speaker 3:

So, having a discussion with a good, ethical, licensed agent about you know what options are out there, what exists, what you might be able to afford, what the benefits are because there's actually living benefits that can be derived from life insurance there's a lot of things that a good agent can talk to you about. And I would just say anybody watching this if you don't have life insurance, or even if you do have life insurance and you don't know exactly how it works or how much you're covered for or how it could benefit you and your family, talk to your agent, find an agent and have an honest discussion with them Because, like I said, my mom passed away several years ago. She had life insurance and I was a beneficiary of some of that and it helped me actually invest in my business. It helped me do some things in my life that I want to do. It had a lasting benefit to me personally. My mom did that for me and that's a big deal, huge deal, huge deal.

Speaker 2:

Well, even in the last few years you mentioned how expensive it is you know what burial costs are. You know a lot of people have moved to not having services and doing cremation. But even cremation is not cheap. I mean, that's still four or five grand right there. Yeah.

Speaker 3:

Yep.

Speaker 2:

You know. So, yeah, I couldn't agree more. Question for you what's the difference between and this is something that I've never really understood clearly, but what's the difference between term life and whole life insurance?

Speaker 3:

Well, two main differences. So term life it goes for a term and a term of time. So you know it could be you know well I guess technically any amount of time, but typically you see, term life policies go between five and 30 years. The advantage of a term life policy especially maybe for younger folks who are starting out who maybe don't have a lot of, you know, a lot of cash, is you can get typically a very high death benefit. You can get hundreds of thousands of dollars of death benefit for relatively little and you can get that rate locked.

Speaker 3:

Let's say, if you're a 25-year-old man in good health, non-smoker, yada, yada, yada, you can get really inexpensive life insurance that will cover you and your family for X number of years call it 30 years and that could do something like, you know, cover the cost of your mortgage if something happens. That could cover maybe student debts that you might have outstanding. That could cover, you know, debt's a big deal in this country. Everybody's in debt. If you're not in debt, you probably already.

Speaker 3:

Just don't know it and you know and that's something that a good life insurance agent is going to they're going to have a frank discussion with you. I mean honestly, they're going to ask you hey, what's your outstanding debt? What are your assets? What do you own that might be at risk if something were to happen to you and your income? It's not because we're being nosy, okay. It's our job to find out how we can protect you and your family. And so, yeah, term life, think of it this way. You know, you get your rate set for X number of years and at the end of that the policy goes away and you can get a new policy, but it's going to be rated for your new age, health conditions, all that kind of stuff. Whole life policy is permanent life insurance until you die, as long as you pay the premium. So if you get a whole life policy for $100,000 when you're 25 years old I say 25 because that's- the last time I feel like I was in good shape.

Speaker 3:

Me too. But as long as you pay the premium on that, if you live to be 100 years old, that insurance is going to be there, and whole life insurance a lot of it. It does have some living benefits. It typically accrues cash value over time because the way insurance companies make money on life insurance is they take the premium and part of that goes to we call it keeping the policy alive. Basically it goes to paying the administrative costs of the policy and then most of it goes into, you know, the stock market or at other types of investments. And I'm telling you, the insurance companies have been around for a long time. They don't. They don't typically lose. All right.

Speaker 3:

Most of their, most of those policies are going to actually accrue cash value at a higher rate than what you could get in a bank deposit. So you could put, you know, I don't know, $1,000 a year in a bank savings account. Inflation is going to eat that. You're going to lose that eventually. Put the same amount of money into a good whole life policy. The cash value over time is typically going to outpace inflation. Now I don't know, last few years have been pretty crazy. I'm not sure how that's working on the short term but long term.

Speaker 3:

If you're looking at things on a long term, looking ahead basis, it's a really simple way to protect your family from again the cost associated with you passing away lost income, because you're going to get that death benefit regardless. But I was thinking one of my whole life policies. I looked at the cash value the other day and I've got over $2,000 of accrued cash value that I can actually pull out. I could get a loan against it or I could just pull it out and use it because it's my money and that would not affect my death benefit or anything like that. So it's a great product. It's a great way to protect your family. It's a great product. It's a great way to protect your family. It's a simple way to you know, try to make your money work for you a little bit. And yeah, they're both good policies. A whole lot policies are more expensive overall than term policies, but you get that locked rate your entire life as long as you pay the premium hmm, so when making what, what?

Speaker 2:

as far as deciding between term and whole life, what do you recommend people consider?

Speaker 3:

It depends on what you're trying to accomplish. Like I said, maybe you know, use an example young, a young couple with a couple of kids, you know, maybe they don't have a whole lot of disposable income but want to be protected. So let's say, let's say the man is the primary breadwinner and maybe the mom would also like to have some protection for the kids in case something happens. So you could get maybe a term life policy for both of them if they're young and good health, or very little money per month for the premium For a 30-year term. Hopefully that's going to protect them and their family through the time their kids are growing up, through them paying off their mortgage, through sending their kids to school, All of those expenses that are expected when you're growing a family, and you can have that protection, that large death benefit, for again, relatively little per month, for again, relatively little per month. On the other hand, if they wanted to, you know, try to maybe consider it almost as like an investment.

Speaker 3:

You know, getting a whole life policy, even a small whole life policy, to supplement the term policy, would be a great investment because at some point assuming they survived the end of the term that that term policy is going to terminate. They're going to be older, they're probably going to have had some kind of medical issues, but if they still have that whole life policy, they're going to be paying the same rate as they were when they were young and in good health, because that rate's locked. As long as that policy is existent and being paid for that rate's locked, it's not going to change. It doesn't matter what happens. That's why I always tell people it's better to get life insurance when you're young, because over time you're going to pay a lot less for it. I got my first life insurance policy when I was 30 years old. I wish I had done it 10 years before because I could have gotten more coverage and paid a lot less for it.

Speaker 3:

Of course I didn't have any money when I was 20 years old, right, so it's a chicken and egg thing, but again, it's something you can talk to an agent about. A good agent, an experienced agent, is going to be able to kind of explain things what the options might be, what the market is looking like. If they're an agent like me who works with multiple companies, they can check different markets. But even a captive agent like a State Farm agent or something like that I say State Farm because that's where I started my career they can talk to you about their products. And again, talking to a professional and getting to know what these things are and how they work and how they can benefit, you can't go wrong.

Speaker 2:

Can't go wrong. Well, I know a guy that I know a guy. So any of our listeners, if you don't have life insurance or you need to get more life insurance, Timothy's the man, give him a call.

Speaker 3:

Yeah, Give me a shout, Like I said I'll. I'll talk about it all day long. You'll get sick of hearing it.

Speaker 2:

Very good. Well, tim love it. We'll catch you in the next episode.

Speaker 3:

Thank you.

Speaker 2:

Talk to you then.

Speaker 1:

All right, man man have a good one that's a wrap on this episode of the walters agency podcast. Ready to find the right coverage for your home, business or family? Call or text 423-417-2070 for a free 20-minute consultation. Until next time, stay covered, stay protected and keep winning with the Walters Agency.