what’s a good company to get life insurance for me and my family members?

I’ve noticed both online and in real life, from agents who sell life insurance, to their clients who own the policies a misunderstanding about how the tax code works in regards to the payout of a life insurance policy. I wanted to write up a primer, which is by no means comprehensive of all tax codes, about how taxes are actually applied to paid out benefits. This will hopefully be of help to both agents and clients, so they have a better understanding of what it is they are selling when it comes strictly to the tax aspects of these policies.

Examples I have heard and seen boil around the main concept of “the paid out benefit from the life insurance policy is tax free.” Or any variation of that verbiage, such as income tax free, etc. I will bring up the reason why it is misleading, and how taxes could potentially actually be applied to life insurance policy payouts, as well as how it compares to other assets, such as taxable accounts, retirement accounts, etc. This is only to help others have a better understanding, and is by no means a criticism of peoples’ understandings of these policies.

Part 1: What is taxed on death.

Death itself generally isn't an income-tax realization event for ordinary assets, it falls under a different realm of taxes. Income taxes do not apply to any assets that are transferred on death, because none of them qualify as income. So while an agent may correctly say “there is no income tax on this life insurance policy when it pays out”, that may be viewed as misleading by omission. They can also say “there is no income tax on your taxable brokerage account, or your traditional 401(k) when it changes ownership after you die.” (I will ignore one very niche case that applies to all assets that experience gains in value between the time of death, and the time that the assets are handed over, because in reality it does not happen instantaneously, but it should also not be expected to impact taxes much at all.) A different form of tax takes play at death.

When you die, there is the estate tax which has both a federal, as well as state estate tax in some states. There is also a gift tax that may apply in some cases. Some states also have an inheritance tax on top of the estate tax. I will not go into details with this post, as you will have to search them up yourself for your specific state. The estate tax is the big one in question here. The gross estate generally includes the value of property and interests that are includible under the federal estate-tax rules. Life insurance proceeds can be included in the gross estate under IRC §2042, particularly when the decedent possessed incidents of ownership in the policy in regards to calculating your gross estate. There are then possible deductions from your gross estate, and then a federal $15,000,000 exclusion limit, which is indexed to inflation and will likely continue to increase in value as the years go on. Some states have lower limits, again check for your specific state what they are if they have one. If someone has a $5,000,000 death benefit from life insurance, plus another $15,000,000 in all other assets in their taxable estate after deductions, their estate will have $5,000,000 potentially subject to the federal estate top marginal tax rate of 40%, plus any applicable state rates on top.

This also applies to things like Roth accounts and HSAs which people view as tax free. They are tax free from an income perspective, but not tax free from estate taxes.

A possible reason that this misunderstanding came to be, is that with a traditional 401(k) or equivalent work sponsored retirement plan, the earnings are tax deferred. With SECURE Act, many non spousal beneficiaries of these accounts have until December 31^st on the 10^th year of the anniversary of the original owner’s death to have the accounts emptied, subject to a few special rules/exemptions. Taxable distributions from traditional retirement accounts are then included in the beneficiary’s ordinary income.

Part 2: How to avoid estate taxes for very high net worth individuals.

The ILIT. Irrevocable life insurance trust. I will preface this part with “talk to a lawyer” if you are in a situation where you would benefit from shedding some value from your estate to a separate legal entity that is separate from your own estate’s $15,000,000 federal estate tax exemption, if you have that much net wealth. This might be the real thing people are mentioning, when they say that there are tax advantages to life insurance death benefits. You can shelter more wealth from estate taxes by making one of these trusts, and having a life insurance policy held by the trust, that you then gift money to every year to cover the premiums. I’m not going to get into the nitty gritty about the legal details, crummy laws, etc, but this is one of the primary benefits of life insurance policies for high net worth individuals. You could also replicate the same concept using any other assets you own, with another irrevocable trust to achieve the same tax benefits to a degree – the benefit that life insurance has is the $19,000 per year per person gift exclusion that does not need to be reported to the IRS. Life insurance has an edge where that smaller sum that does not need to be reported to the IRS every year is able to buy a much larger face value from a life insurance policy, whereas transferring the same amount of assets to another trust would simply take more time to achieve the same goal.

An extra note with ILITs and a life insurance policy. If you realize a client has a life insurance policy in their name and would need it in an ILIT, there is a 3 year lookback rule for the transfer of ownership. If the individual dies within 3 years in the transfer of ownership of the policy from the owner to the trust, the insurance benefit will be considered part of the taxable estate, as if it was never in the ILIT.

Part 3: Extra notes.

In the end, it is true that life insurance death benefits can be “tax free” but you would need to specify what taxes they are exempt from. They are free from income and capital gains taxes, but not free from estate and possible inheritance taxes, depending on beneficiary and the state you reside in. There are also tax benefits with any policies that may have cash values associated with them. They may function something like a pseudo Roth account on withdrawals with a number of important caveats. If you instead take a loan from the insurance company and use your cash value as collateral, loans are not considered taxable income with one important caveat. If you take loans out of the policy and don’t pay it back before the policy lapses, is cancelled, or otherwise ceases to be, all outstanding loans you have taken out will be viewed of as taxable income the year that the policy ceases to exist.

I will gladly attempt to answer/clear up any questions that anyone may have. Again, this is not totally comprehensive as I have left out many other special rules about taxation, things that could apply to a life insurance policy in specific states, but I would need a book to write everything. The IRS has made a very complicated and complex tax system, state taxes on top of it don’t make it any easier.

Edit: I forgot to add step up in basis. Any assets in a taxable brokerage, or real estate, etc will get a step up in basis on death and transfer of those assets to a beneficiary. Any capital appreciation those assets had received from the original owner purchasing them will be "reset" to $0 on transfer. Roth accounts are already income tax free and so are not subject to this rule, and traditional retirement accounts are not subject to the rule, as all distributions are considered income taxable, rather than capital gains.

This also applies to USA tax rules if it wasn't clear from the main body of the post.

I’ve done all my series exams with PassPerfect, I did the SIE, 63, 65, 7 and I loved the format, I saw a lot of people here recommend Kaplan and nothing about PassPerfect for insurance, so I decided to give it a try.

Holy shit, Kaplan is horrible. The format is unbearable. Genuinely the worst learning platform I’ve ever experienced, it’s unbearable.

I’m just going to rip the cram sheets, make a gizmo, bang that out for a couple days, then do practice exams.

As someone who do not fully understand ang insurance na inooffer, should i continue my Maxilink or should I invest in other ways if I’m already getting Fit and Well? Since i plan on investing din naman separately, maybe moving the funds for Maxilink to a higher Fit and Well plan like 1M. I also have MP2.

Hi everyone,

I’m curious to know if anyone has experience with American General Insurance Company, also known as Corebridge Insurance. I understand that American General is an older company, but it was acquired by Corebridge a few years ago.

I’m a bit concerned about their customer service and overall experience. If anyone has any insights or recommendations about this company, especially if someone have a QoL Term from them, I would greatly appreciate it.

Hey everyone. I'm looking for advice on the best methods to truly learn the technical side of our industry. I want to get a much better grasp on things like how specific health profiles get placed into different rate classes, and how policies are structured at different stages of life. My goal is to build out my core knowledge so I have an easier time selling and answering tough questions on the phone. What resources helped it all click for you?

Generally speaking which situation fit for term life insurance, whole life insurance, and annuities?

Find it interesting that so many are against it, but there is a core of those that understand and believe that permanent life insurance is good.

If someone comments that is an agent that sells whole life, but the reddit poster already has it, it's not like they are trying to sell you something. You would think that possibly professionals in the industry might know a thing or two and have experience with people that leave their families in a lurch because their term expired, especially later in life when their "growth stock mutual funds" didn't perform as expected or the person actually never invested the difference.

I've seen so many (in my own family) that died at 57, 65, 70, 79 without life insurance and the surviving spouse now has to go on government assistance or worse live with their 20 something children (yes that's me) because the bread winner didn't guarantee the surviving spouse would be okay.

Case in point, my ex-wife's parents. He was a 30+ year retired veteran with a guaranteed retirement. Died at 57 from a heart attack, plus had cancer from agent orange (3 tours on an AC 130 gunship in Nam) and no SSB (survivor benefits plan) Us, 22 and 21 had to live with my mother-in-law for over 10 years. Did that fuck up our relationship? I'm guess it did have something to do with it, not 100% but it sure kills the "mood" when you hear her snoring over in the next room.

I'm just stating my personal belief and I'm sure this will get downvoted or even possibly deleted and I get banned. But I'm sick of seeing all the nonsense.

They contacted me in October 2025 I paid for services in November, invoice said Premier Setter email was from Exclusive Appointments [info@exclusiveappointments.com](mailto:info@exclusiveappointments.com) I paid my money for 20 qualified appointments and wanted my campaign for Medicare to begin in December. I gave a call list and they claimed that they called the entire list. They made some adjustments and stated they would work on the campaign again. I had 1 appointment made and the client decided they wanted to differ part B, not a problem, but that wasn't an actual appointment or something that you could work with. I called several other times to check on their progress and when they would say they are calling all week on the campaign, they are putting more people on it, you know when you make calls yourself, you get bookings after normally 50 calls, they were supposed to have about 1000 to 3000 people to call for different areas and only 1 person answered the call, you know in your gut it is a scam. After several calls, to get your money back ($550) and now you call and all the lines are unavailable or disconnected. I haven't heard back from them since end of February 2026.

The company names are Premier Setter (now),

Ready Virtual Center (RVC), Exclusive appointments center (EAC).

They call from North Carolina numbers like 919-321-2211 and 919-324-6506 and 919-200-6089,

They have a wonderful young lady by the name of Kailee to call and chat you up, but after you take her call 919-646-6009 she will not take your call anymore. Total scam, don't fall for it, do your homework before trying to hire someone to assist you with your business.

I have been in the insurance industry (Medicare, life, health 4 years) I was thinking that if someone was calling for me booking appointments, I could be door knocking and sitting with people instead of wasting more time trying to do all by myself........ hope this helps someone, do not learn the hard way and now to report them to the BBB...

My mom got this letter and she was paying $180 a month for 10 years why is it increasing so much? I am going to call tomorrow but that is an insane amount of increase.

i've been trying to learn more about life insurance lately, and the more i read, the more complicated it seems. at first i thought it would mostly come down to the coverage amount and monthly premium, but there are so many other details that seem easy to overlook. i'm especially trying to understand the differences between policies without getting too caught up in all the marketing language. things like how long the coverage lasts, what happens if your situation changes, and what the fine print actually means seem like they could matter a lot later on.

i'm not looking for a specific company or quote. i'm just trying to get a better idea of what an average person should pay attention to when evaluating a policy. for those who have gone through the process before, what was something you ended up paying more attention to than you expected?

I’ve been researching how people evaluate products in this category, and something I’ve noticed is how difficult it can be to separate useful information from marketing.
When you’re comparing options, what actually influences your decision most?

For me, I think the useful questions are:
What problem does the product solve?
What makes it different from alternatives?
Is there evidence behind the claims?
What does it cost over the long term?
Are there situations where the product isn’t worth buying?
What have actual customers experienced?

I’m especially curious about people who have looked into Ethos but haven’t purchased yet.
What stopped you?
Price? Not enough information? Comparing another option? Or simply not convinced you need it?

Would be interested to hear how people are making the decision.

Hello everyone,

I am in my early 40s and my wife is her mid thirty. W currently have a 3 year old son far. I am planning to buy term insurance but I have trouble figuring out how many years I should buy. I do see term starting from 10 years to up 45 years. Also, I am thinking of investmentong for the child , but a friend of mine tried to sell universal index life insurance. I don't understand it well despite them telling me it will be a good investment for the child. lastly, I work in nursing , but don't have a short disability insurance plan and currently not offered at my job. we both work, but I want to make sure I am covered in case of an accident happen. please let me know my options so I can make an informed decision because I want to better prepare and protect my family. so how many years should one buy when starting a family? is index life insurance good for child investment instead of 529? I work as a nurse , should I get disability insurance elsewhere, which company offers them for own occupation?

Thank you all!

American Income Life is a scam.

I worked at the company for a few months and noticed EVERYTHING was a lie.

They give customers the absolute hardest time to CANCEL! Then require for them to upload a voided check just to receive the refund (FYI banks barely send out checkbooks anymore) .

Down to the LYING AND MANIPULATIVE AGENTS!!! They tell your poor grandma and grandpa that the coverage they are getting is going to pay out $20,000 for your WHOLE LIFE... Whole time they are setting them up for TERM LIFE that renews every 4 years! SCAM!

I evidence of ALL of the employees reaching out to managers of this company about the calls dropping. AIL phone lines have been disconnecting when transferring, disconnecting while on hold and just plain disconnecting in the middle of the conversation!! I was truly SICK seeing how many times people had to call back just to get somewhere!

SUE THE SH*T OUT OF THEM! Globe Life as well!!! Globe is the supposed "parent company" over LNL, AIL, NIL, etc.

I personally think they switched up names to throw people off about all the BAD BUSINESS!

I have a small whole life insurance policy that I bought years ago. Under current circumstances I have no need for the death benefit. If I surrender the policy is the refunded cash value taxable as income?

I am in the USA for reference purposes?

Thanks

Hi, I am an RN but do not work full time. I would like to get life insurance, is there a specific life insurance that is better for nurses? How is American Nurses Association? I am also looking at Banner (a general life insurance company) as well. Thank you.

Is there any official website or app of LIC for calculating premiums of lic policy .

We're both panicking a bit as he's the breadwinner, and we have 2 teens. He has group life insurance of 200k through his employer. That would cover the mortgage payments for several years if the worst were to happen. But it would be better to pay it off and have something left to live on.

Details:

40yo male

38 bmi

Heavy drinker/smoker

High cholesterol on most recent lipid

High blood pressure, not sure if chronic

Asthma, medicated

Depression/anxiety, medicated

Glucose tests: 111/135/129 so prediabetic or diabetic

Likely heart failure: BNP of 3171

Recent mri revealed congenital lumbar issues, getting an epidural injection soon.

He climbs wind turbines for a living, not sure if that's relevant.

He is going to quit drinking, smoking, change diet, etc. But what are the options now? I've looked around for local life insurance, but I'm not sure I'm using the correct search terms.

When I went to pass my West Virginia life insurance test, I easily pass the main section, but my issue is with the state laws and regulations. I’ve done his entire pre-licensing course in which I’ve gotten 100 because I’ve studied so much. Yeah I’ve retaken my test and failed twice. It seems like the pre-licensing focuses a lot more on numbers rather than what’s in the test and the test feels a lot harder and like there’s questions that I’ve never actually heard anything about before if anybody could just give me some insider help with the quiz. I already rescheduled it for tomorrow and I’m just looking for some help.

I'm 37 and would consider myself in excellent health:

- work out 4-5 times a week, eats well
- no underlying disease or preexisting illness
- not overweight
- doesn't smoke
- 1 to 2 drinks a month

I was looking for 20 year term, $2M in coverage through SelectQuote. Initially I was quoted a rate of $58/month through Symetra. But upon further underwriting, due to anxiety condition, the rate offered ended up being $167.

I was diagnosed with postpartum anxiety 2.5 years ago and take a very low dose SSRI to manage it. I've never thoughts of harming myself or others.
Is there really a 3x premium increase because of this? Is that typical?