David G. Frank

That's where David G. Frank, Butler Wick's Insurance Director since 1987, comes into the picture.Before and as clients' assets grow, they need the protection that life insurance provides their families.

Frank, a Chartered Life Underwriter and Chartered Financial Consultant, sees term insurance as the best product for younger people just starting out in their careers.

"Term insurance is like renting," Frank explains."You can buy more coverage.You have the protection and hope your family never needs it."Term usually runs, 10 to 20 years but can run as long as 30, he says.

Whether term or "permanent," as Frank calls permanent policies -- universal, variable and whole life insurance -- the beneficiaries have the protection necessary should the insured die unexpectedly.With permanent insurance, the insured also builds a reserve fund, or cash value, for his or her retirement.

The younger the insured, the lower the rates.Often young people are advised to purchase term insurance and invest the difference between that and what they would pay for permanent insurance."My experience is that people take half that advice," Frank says."They buy term but don't invest the difference."

Which is why he thinks permanent insurance has so much value.The insured pays premiums until the policy matures and his beneficiaries receive the payment upon death.

Permanent life policies have a cash surrender value should the insured choose to redeem it before maturity -- something Frank recommends against.Better that someone in a financial bind borrow against the cash value of the policy and repay, he points out.

The premium for a universal life policy is much lower, but the insured assumes two risks, the risk of the changing interest rate environment and changes in life expectancies.The insurance company can adjust your premiums if significant changes occur in either area.These contracts should be reviewed by your insurance professional periodically to protect your long-range coverage.

The variable life insurance policy is much like universal life, Frank says, but the insured assumes market risk in addition.
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Frank thinks such a benefit is not worth the added expense in the premium.

DAVID G. FRANK, V.P. Director

David Frank Vice President Insurance Group