Investment Education Insurance Insurance is a contract between a client and a provider whereby the client makes payments, called premiums, in exchange for the promise that the provider will pay for certain expenses. For example, if one purchases health insurance, the provider will pay for (some of) the client’s medical bills, if any. Likewise in life insurance, the provider will give the client’s family a certain amount of money when the client dies. The insurance company spreads the risk of any one expense by pooling the premiums from many clients. Fixed Annuities A fixed annuity is an investment contract sold by a life insurance company that guarantees regular payments to the purchaser for a specified period of time, or for life. The purchaser generally pays a premium either in a lump sum or in installments. Fixed annuities are long-term investment vehicles designed for retirement purposes. Gains from tax-deferred investments are taxable as ordinary income upon withdrawal. Guarantees are based on the claims paying ability of the issuing company. Withdrawals made prior to age 59 are subject to a 10% IRS penalty tax and surrender charges may apply. Life Insurance Life insurance is an insurance policy where, in exchange for a premium, the insurance company pays a certain benefit to the survivors of the policyholder upon his/her death. Life insurance can help defray costs of the funeral, pay off the estate’s debts, and may provide for the survivors’ (notably a widow or widower) future. There are two main types of life insurance. Term life insurance lasts only for a certain period of time and pays the death benefit only if the policyholder dies during that time. Whole life insurance lasts as long as the policyholder remains alive and provides a savings component against which the policyholder can borrow under most circumstances. Buy-Sell Agreements A buy-sell agreement is an agreement among business partners or shareholders describing the circumstances and terms of sale if one or more wish to exit the arrangement or wish to sell their shares to an outsider. Long Term Care (LTC) LTC insurance provides long-term medical care for a debilitating but non-life threatening condition. For example, one may require long-term care if one is involved in a car accident or has a non-terminal disease that does not allow him/her to live independently. Long-term care often involves the inability to perform at least some of the activities of daily living. One may purchase long-term care insurance to pay for some of the expenses associated with long-term care. The LTC benefits may also be shared among married couples. For example, if a couple were to buy a ten-year joint policy and one of the spouses died after 3 years, the remaining spouse would still be eligible to receive 7 years of LTC. These policies can also be indexed for inflation. Policy guarantees are based on the claims paying ability of the issuing company. For more information please call or email EWMG. Investment Education Fixed Income Tax Deferred Alternative Investments Taxable Fixed Income Derivative Equities Tax Free Income Insurance .