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LIFE INSURANCE 101

Got two minutes? That's all it takes to learn about our life insurance offerings. No, seriously.

Clever Life Coverage Options
TERM LIFE WHOLE LIFE WHOLE AND TERM MORE OPTIONS

Term Life

Term Life


Term life insurance is the most common form of coverage. It really isn't for you at all. Term life insurance helps your family or loved ones pay the bills if something unforeseen (like premature passing) happens to you and you are no longer able to contribute with your income. This type of coverage protects your family for a specified "term" or specified number of years. Makes sense, right? The idea is that after this "term" you will no longer need as much life insurance. Why? Because the hope is, as time passes your kids will become adults, your house will be paid off (yes!), and your income will be replaced by retirement savings. This type of coverage is typically cheaper and it's very likely people who have term life insurance will outlive their policy term. Common terms are 10, 20, and 30 years. So basically, you can get more coverage or a higher face amount for less money with term. Clever's term life policies are all convertible to whole life coverage before the term ends or before a certain age. The privilege to convert or switch the policy is pretty cool because the customer can do this without being asked any new medical questions at the time of the switch.

Whole Life

Whole Life


Whole Life insurance protects someone for their "whole" life. Sometimes called "permanent life insurance", this insurance cannot be canceled by the insurance company and provides coverage until you pass away. The only way for you to stop coverage is to request a stop or simply quit paying for it. Whole lIfe insurance is the type of life insurance that builds a cash surrender value. Once the house is paid off and the kids are grown, you have less initial need for life insurance and would be able to "cash" it in and receive values back from your life insurance. Term Life insurance does not do this. Really, no other type of insurance can provide cash back to you at the time the insurance is no longer needed. This cash may also be set up on a lifetime plan, sending you a monthly check for the rest of your life if you choose. Pretty sweet, huh? As you age, you may still need some life insurance (just not what you needed back when expenses were high and debt was plentiful). You have the option to stop paying premiums on your whole life insurance and take a lesser benefit amount as a paid-up plan. The longer you pay the premiums, the more the benefit amount will be. This type of coverage works very well as a gift to children. Rates are based on age and are at their lowest when young. The child can then be protected against situations regarding insurability. This coverage may stay in force for as long as needed even if the child, or later the adult, cannot get life insurance due to cancer, heart disease, or certain other health conditions.

Whole Life with Term Life Rider

Whole Life with Term Life Rider


Get the best of both. Over age 15, you may be able to purchase a whole life policy with a term life rider attached. Customize this option with some of the permanent coverage with some of the less expensive term coverage for a chosen amount of time. Talk about Clever!

More Options

More Options


Clever offers tons of other types of coverage, from an accidental death benefit rider to a waiver of premium rider and beyond. Want to learn more about these selections? Click here to view the whole list of coverage options and read more about them.

Here are some frequently asked questions from customers like you.

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At Clever, we think life insurance is a gift. Life insurance can be used to fulfill a portion or all of your family's future needs by replacing your income if you no longer have one. Although life insurance is not required, many people feel secure knowing their life insurance will cover specific needs such as making sure the mortgage is paid off and leaving the family with a debt-free home or covering final expenses.
Pretty simple. The life insurance company's purpose is to pay a beneficiary upon proof of passing.
Employer group life insurance is great as supplemental coverage, but retiring, getting laid off or ending employment oftentimes kicks you out of the group. Group coverage is usually only good when you are part of the group. An individual life insurance policy at Clever is yours no matter where your career journey takes you.
Yes. Even though your spouse may not earn an income, you will most likely have additional expenses in the event of your partner's passing. Take, for example, a stay at home parent. What would it cost to hire someone to do all the things done on a daily basis? Just think about the cost of daycare and housekeeping alone.
Ok, tough topic. We don't depend on our children financially but should the unthinkable happen we will have some financial considerations. Funeral costs can be very expensive. If you don't have the ability to pay out-of-pocket, life insurance is an affordable alternative. Life insurance for a child is very inexpensive and it is a great gift for them to have later on in life. It also protects against a future where they may not be insurable.
If you have knowingly misrepresented your health or information, the policy coverage may not apply and your policy could be returned and premium refunded. In short, don't lie. There is also a two year contestability period. If you pass away during the first two policy years, there may be further investigation into the answers given on the application and whether or not any misrepresentation was relevant to the cause of passing.
There are different ways to determine the amount of life insurance you need. Most experts agree you need to evaluate these areas to determine how much insurance is enough:
  • Income Replacement
    • What will your family need to maintain the same standard of living if you pass away prematurely? Income needs are usually greatest when you have minor children. Most experts agree that you will need several years of annual income for replacement purposes.
  • Mortgage Balance
    • Money will be needed to pay the balance of your mortgage (if you have one). If you rent, you will want to consider putting money aside for a "rent fund."
  • Debt Repayment
    • If you have a car loan, mortgage, student loans, credit card balances, or virtually any debt, you'll need to consider the total amount when determining how much life insurance your family will need cover these debts.
  • Education for Children
    • Education is important, but it's expensive and it will cost more in the future. Consider the future cost of tuition, room and board, books, and other fees for each of your children as you set a target coverage amount.
  • Final Expenses
    • Final expenses refer to things like final medical or hospital costs and funeral expenses. Funeral arrangements and final wishes don't have to be a financial burden on your family or a reason to start a crowd fund. Calculating these expenses into your total coverage amount is essential.
  • Emergency Fund
    • Plan for emergencies. Whether it's home or auto repairs or something as serious as medical emergencies, it's always a good idea to have some money stashed so your family can be prepared for these unexpected mishaps. Life Insurance can help, figure it in.
It can. Many people purchase life insurance in order to keep their spouse and family in the same home if their income is no longer available. Covering the mortgage with the proceeds is really up to the beneficiary.
Face amount and amount of coverage may typically be used interchangeably. Face amount is the amount of coverage or the proceeds of the policy payable to a beneficiary.
Term insurance will expire at the end of the "term". Usually a length of years or to a certain age. Whole life does not expire. Whole life may be active for the rest of your life, you get to decide.
It's simple. Get a quote, decide what you want, explore add-ons, and select your payment options.
Nope. We keep it simple at Clever. No physicals, no lab work, just some easy medical Q and A.
Life insurance premium is based on several factors. Male or female? Females statistically live longer leading to cheaper rates. Age? It's cheaper the younger you are. Your health status? Someone that uses nicotine will pay a higher price.
Premiums are not guaranteed after the first year. However, your premiums are scheduled to remain level or the same, and we plan to keep them level for the duration of your policy. There are companies that offer increasing premiums or reducing coverage, but we keep life insurance simple at Clever.
Yes, in most cases. The majority of our clients choose a revocable beneficiary, which can be changed by the owner of the policy at any time. There are some situations where the owner chooses an irrevocable beneficiary. In this case, the beneficiary would have to approve the change along with the owner of the policy.
On any of our life policies you decide when you are through with it, no longer need it, or want to surrender it. Cash value surrender, on whole life insurance, is when you request a surrender of your policy and we send you the accumulated net cash value.
A life insurance policy stands ready to pay your beneficiary almost immediately upon your passing. This is true whether it's been just a few weeks after the policy is purchased or years after the purchase. So, yeah, we think it's worth it.
Anytime there is a beneficiary that has an insurable interest in your living. Meaning, as long as someone is affected financially by your unexpected passing, we think it's worth it.
Sure. As long as your total amount of coverage is not more than allowed by our company. Most people can address the majority of their needs with one life insurance policy.
You got it. Our Clever life insurance does not require a health exam.
Yes. If diagnosed with a terminal illness, you may be able to withdraw a portion of the proceeds. There is also a loan against cash value option when you have whole life insurance.
Seek the advice of a tax professional. Cash value withdrawn as part of a surrender or loan may be taxable if it is more than the premiums you have paid for the policy. This gets a little technical.
Life insurance can be a piece of a business succession plan. Please consult an accounting professional. People do purchase life insurance for business needs. For example, two partners may purchase life insurance on each other for the purpose of keeping the business going if one or the other of the partners passes away unexpectedly. Or, if you, as a business owner, have a key employee you may have an insurable interest if they were to pass away unexpectedly, you would be affected financially.
If you stand to be adversely affected, financially, by someone's unanticipated passing, you may have insurable interest. A spouse that can no longer rely on another's income is an easy example. Or, children that may have a more difficult time paying for college. An employer that relies heavily on a key employee would have insurable interest because if the employee were to pass away unexpectedly, the employer would be adversely affected financially. A Partnership that relies on partners contributing is another example. The partnership would need to survive the passing of one if its principles. Spouses, parents, children, grandparents, grandchildren, and siblings all have automatic insurable interest.
The person who receives the benefit (the funds) when the person covered passes away is the beneficiary.
A primary beneficiary gets all the proceeds when the customer passes away. A secondary or contingent beneficiary only gets proceeds if the primary beneficiary is not alive when the customer passes away. There can be more than one primary or secondary beneficiary. Policy owners can leave a percentage to all named beneficiaries.
Term life insurance is perhaps the simplest form of life insurance. It provides temporary life insurance protection on a limited budget. Term life insurance is a way to get the most amount of coverage for the lowest cost. Since term insurance can be purchased in large amounts for a relatively small premium, it is well suited for short-range goals such as life insurance coverage to pay off a loan, or providing extra life insurance protection during the child-raising years. Term life insurance provides death protection for a stated time period, or term. The main drawback to term insurance is that after the specified term is over, you have outlived the purpose of the insurance and cannot redeem it for any value. Also, if you were to apply again, the cost will be higher based on age. The good news is that all of our term products are convertible to permanent insurance depending on your age, and you will not be required to complete any medical exams.
Whole life provides life insurance protection for as long as the policy is kept in force ("whole life"). Whole life policies feature lifelong protection, guaranteed premiums, guaranteed death benefit, and a cash value. The cash value can grow each year and grows tax deferred. The cash value can even be borrowed against to help with emergencies or when times get tough.
Whole life is present for your entire life unless canceled by you. It may have varying premium paying years but stays in force until there is a claim unless directed otherwise by the customer. Term is in force during a certain "term" or period of time.
Cash value is an internal buildup of money inside a whole life or permanent life insurance policy. The cash value grows on a tax deferred basis, meaning if a taxable gain were to happen, you would not be taxed on that gain until you withdraw the values. If your proceeds are paid to your beneficiary, the proceeds are tax free. The cash value in the policy can be accessed through policy loans or surrenders. However, surrendering the cash value or taking a loan on it may have an adverse effect on your policy and benefits paid. The cash value is not a savings account but it can be a useful way to get funds in the event of an emergency.
On a whole life plan, you will get an annual statement that reflects cash value. This cash value can be borrowed out of the policy by you for any unforeseen, short term needs. We recommend that the cash value be returned in order to restore full benefits to your policy.
Whole life insurance matures at age 100. Even if you live beyond 100 years, which happens more every year, your insurance can stay in force. Maturity is just a fancy word for paid up. There are no more premiums due once the policy reaches maturity. Most plans mature at age 100, but there are some exceptions. For example, when deciding on a life insurance policy, some people prefer an earlier maturity option and may have the plan paid up well in advance of the 100 year mark. At Clever, we give you these options, too.
If you add the waiver of premium coverage, we may pay the premiums for you if you become totally disabled. It's kind of like insurance for insurance premiums.
The extras or "riders" are additional coverages that can be added for very little cost. Riders are a very cost effective way to enhance or increase your overall customized coverage.
  • Waiver of Premium
    • This agreement provides for the waiver of premiums (we pay the premiums for you) while the insured is totally and permanently disabled.
  • Guaranteed Purchase Option
    • This add-on grants the insured options to purchase new, additional insurance, without any additional medical questions or exams, on the policy at specific times throughout life. Specifically, these times include: the policy anniversaries following the insured's 25th, 28th, 31st, 34th, 37th, and 40th birthdays. It protects the insured from being denied life insurance for any health reasons in the future.
  • Accidental Death Benefit
    • This provides additional coverage up to the same as the original amount if you're passing is accidental.
  • Accelerated Benefits
    • This provides a one-time accelerated payment of the death benefit. If diagnosed with a terminal illness at some point in the future you may be able to access some of your coverage, up to 50% of the coverage amount.
  • Level Term Insurance
    • This provides additional term coverage to a whole life plan. This additional term coverage is cheaper, builds no cash value, and is in force for a specified "term" or duration of years.
Upon the passing of an insured, the beneficiary should contact Clever by calling us at 1-833-MYCLEVER (1-833-692-5383), or email us. To assist us in providing the best possible service, we'll need the name of the insured, the date and cause of death, and the name, address, and telephone number of the primary beneficiary (ies).
Simply put, we want to work with your beneficiary to receive the necessary documentation and pay as quickly as possible. The benefit of your policy can be paid in several ways at the choice of the beneficiary. There may be an immediate need for the entire lump sum to pay for medical expenses or funeral costs, for example. After a traumatic loss, many beneficiaries choose to take a breath and avoid hasty decisions. Proceeds can be left to earn interest, to set a payment stream up for a designated number of years, pay a lifetime income, or pay a designated amount as requested. Beneficiaries can withdraw as much of the death benefit as they wish and leave the remaining balance with the company under an interest option, with the understanding that they can withdraw the remaining balance at any time. The money earns interest until the beneficiary chooses to withdraw it. The proceeds can also be put into an annuity to create an income for the beneficiary's lifetime or for a specific period of time, again, at the choosing of the beneficiary. Every situation is unique, so flexibility is key.
No. We recommend that an adult be named as a beneficiary. If the desire is to pass proceeds on to a minor child, please use an adult as an informal trustee. This person should be the expected care giver if parents are no longer alive.
At Clever, we think life insurance is a gift. Life insurance can be used to fulfill a portion or all of your family's future needs by replacing your income if you no longer have one. Although life insurance is not required, many people feel secure knowing their life insurance will cover specific needs such as making sure the mortgage is paid off and leaving the family with a debt-free home or covering final expenses.
Pretty simple. The life insurance company's purpose is to pay a beneficiary upon proof of passing.
Employer group life insurance is great as supplemental coverage, but retiring, getting laid off or ending employment oftentimes kicks you out of the group. Group coverage is usually only good when you are part of the group. An individual life insurance policy at Clever is yours no matter where your career journey takes you.
Yes. Even though your spouse may not earn an income, you will most likely have additional expenses in the event of your partner's passing. Take, for example, a stay at home parent. What would it cost to hire someone to do all the things done on a daily basis? Just think about the cost of daycare and housekeeping alone.
Ok, tough topic. We don't depend on our children financially but should the unthinkable happen we will have some financial considerations. Funeral costs can be very expensive. If you don't have the ability to pay out-of-pocket, life insurance is an affordable alternative. Life insurance for a child is very inexpensive and it is a great gift for them to have later on in life. It also protects against a future where they may not be insurable.
If you have knowingly misrepresented your health or information, the policy coverage may not apply and your policy could be returned and premium refunded. In short, don't lie. There is also a two year contestability period. If you pass away during the first two policy years, there may be further investigation into the answers given on the application and whether or not any misrepresentation was relevant to the cause of passing.
There are different ways to determine the amount of life insurance you need. Most experts agree you need to evaluate these areas to determine how much insurance is enough:
  • Income Replacement
    • What will your family need to maintain the same standard of living if you pass away prematurely? Income needs are usually greatest when you have minor children. Most experts agree that you will need several years of annual income for replacement purposes.
  • Mortgage Balance
    • Money will be needed to pay the balance of your mortgage (if you have one). If you rent, you will want to consider putting money aside for a "rent fund."
  • Debt Repayment
    • If you have a car loan, mortgage, student loans, credit card balances, or virtually any debt, you'll need to consider the total amount when determining how much life insurance your family will need cover these debts.
  • Education for Children
    • Education is important, but it's expensive and it will cost more in the future. Consider the future cost of tuition, room and board, books, and other fees for each of your children as you set a target coverage amount.
  • Final Expenses
    • Final expenses refer to things like final medical or hospital costs and funeral expenses. Funeral arrangements and final wishes don't have to be a financial burden on your family or a reason to start a crowd fund. Calculating these expenses into your total coverage amount is essential.
  • Emergency Fund
    • Plan for emergencies. Whether it's home or auto repairs or something as serious as medical emergencies, it's always a good idea to have some money stashed so your family can be prepared for these unexpected mishaps. Life Insurance can help, figure it in.
It can. Many people purchase life insurance in order to keep their spouse and family in the same home if their income is no longer available. Covering the mortgage with the proceeds is really up to the beneficiary.
Face amount and amount of coverage may typically be used interchangeably. Face amount is the amount of coverage or the proceeds of the policy payable to a beneficiary.
Term insurance will expire at the end of the "term". Usually a length of years or to a certain age. Whole life does not expire. Whole life may be active for the rest of your life, you get to decide.
It's simple. Get a quote, decide what you want, explore add-ons, and select your payment options.
Nope. We keep it simple at Clever. No physicals, no lab work, just some easy medical Q and A.
Life insurance premium is based on several factors. Male or female? Females statistically live longer leading to cheaper rates. Age? It's cheaper the younger you are. Your health status? Someone that uses nicotine will pay a higher price.
Premiums are not guaranteed after the first year. However, your premiums are scheduled to remain level or the same, and we plan to keep them level for the duration of your policy. There are companies that offer increasing premiums or reducing coverage, but we keep life insurance simple at Clever.
Yes, in most cases. The majority of our clients choose a revocable beneficiary, which can be changed by the owner of the policy at any time. There are some situations where the owner chooses an irrevocable beneficiary. In this case, the beneficiary would have to approve the change along with the owner of the policy.
On any of our life policies you decide when you are through with it, no longer need it, or want to surrender it. Cash value surrender, on whole life insurance, is when you request a surrender of your policy and we send you the accumulated net cash value.
A life insurance policy stands ready to pay your beneficiary almost immediately upon your passing. This is true whether it's been just a few weeks after the policy is purchased or years after the purchase. So, yeah, we think it's worth it.
Anytime there is a beneficiary that has an insurable interest in your living. Meaning, as long as someone is affected financially by your unexpected passing, we think it's worth it.
Sure. As long as your total amount of coverage is not more than allowed by our company. Most people can address the majority of their needs with one life insurance policy.
You got it. Our Clever life insurance does not require a health exam.
Yes. If diagnosed with a terminal illness, you may be able to withdraw a portion of the proceeds. There is also a loan against cash value option when you have whole life insurance.
Seek the advice of a tax professional. Cash value withdrawn as part of a surrender or loan may be taxable if it is more than the premiums you have paid for the policy. This gets a little technical.
Life insurance can be a piece of a business succession plan. Please consult an accounting professional. People do purchase life insurance for business needs. For example, two partners may purchase life insurance on each other for the purpose of keeping the business going if one or the other of the partners passes away unexpectedly. Or, if you, as a business owner, have a key employee you may have an insurable interest if they were to pass away unexpectedly, you would be affected financially.
If you stand to be adversely affected, financially, by someone's unanticipated passing, you may have insurable interest. A spouse that can no longer rely on another's income is an easy example. Or, children that may have a more difficult time paying for college. An employer that relies heavily on a key employee would have insurable interest because if the employee were to pass away unexpectedly, the employer would be adversely affected financially. A Partnership that relies on partners contributing is another example. The partnership would need to survive the passing of one if its principles. Spouses, parents, children, grandparents, grandchildren, and siblings all have automatic insurable interest.
The person who receives the benefit (the funds) when the person covered passes away is the beneficiary.
A primary beneficiary gets all the proceeds when the customer passes away. A secondary or contingent beneficiary only gets proceeds if the primary beneficiary is not alive when the customer passes away. There can be more than one primary or secondary beneficiary. Policy owners can leave a percentage to all named beneficiaries.
Term life insurance is perhaps the simplest form of life insurance. It provides temporary life insurance protection on a limited budget. Term life insurance is a way to get the most amount of coverage for the lowest cost. Since term insurance can be purchased in large amounts for a relatively small premium, it is well suited for short-range goals such as life insurance coverage to pay off a loan, or providing extra life insurance protection during the child-raising years. Term life insurance provides death protection for a stated time period, or term. The main drawback to term insurance is that after the specified term is over, you have outlived the purpose of the insurance and cannot redeem it for any value. Also, if you were to apply again, the cost will be higher based on age. The good news is that all of our term products are convertible to permanent insurance depending on your age, and you will not be required to complete any medical exams.
Whole life provides life insurance protection for as long as the policy is kept in force ("whole life"). Whole life policies feature lifelong protection, guaranteed premiums, guaranteed death benefit, and a cash value. The cash value can grow each year and grows tax deferred. The cash value can even be borrowed against to help with emergencies or when times get tough.
Whole life is present for your entire life unless canceled by you. It may have varying premium paying years but stays in force until there is a claim unless directed otherwise by the customer. Term is in force during a certain "term" or period of time.
Cash value is an internal buildup of money inside a whole life or permanent life insurance policy. The cash value grows on a tax deferred basis, meaning if a taxable gain were to happen, you would not be taxed on that gain until you withdraw the values. If your proceeds are paid to your beneficiary, the proceeds are tax free. The cash value in the policy can be accessed through policy loans or surrenders. However, surrendering the cash value or taking a loan on it may have an adverse effect on your policy and benefits paid. The cash value is not a savings account but it can be a useful way to get funds in the event of an emergency.
On a whole life plan, you will get an annual statement that reflects cash value. This cash value can be borrowed out of the policy by you for any unforeseen, short term needs. We recommend that the cash value be returned in order to restore full benefits to your policy.
Whole life insurance matures at age 100. Even if you live beyond 100 years, which happens more every year, your insurance can stay in force. Maturity is just a fancy word for paid up. There are no more premiums due once the policy reaches maturity. Most plans mature at age 100, but there are some exceptions. For example, when deciding on a life insurance policy, some people prefer an earlier maturity option and may have the plan paid up well in advance of the 100 year mark. At Clever, we give you these options, too.
If you add the waiver of premium coverage, we may pay the premiums for you if you become totally disabled. It's kind of like insurance for insurance premiums.
The extras or "riders" are additional coverages that can be added for very little cost. Riders are a very cost effective way to enhance or increase your overall customized coverage.
  • Waiver of Premium
    • This agreement provides for the waiver of premiums (we pay the premiums for you) while the insured is totally and permanently disabled.
  • Guaranteed Purchase Option
    • This add-on grants the insured options to purchase new, additional insurance, without any additional medical questions or exams, on the policy at specific times throughout life. Specifically, these times include: the policy anniversaries following the insured's 25th, 28th, 31st, 34th, 37th, and 40th birthdays. It protects the insured from being denied life insurance for any health reasons in the future.
  • Accidental Death Benefit
    • This provides additional coverage up to the same as the original amount if you're passing is accidental.
  • Accelerated Benefits
    • This provides a one-time accelerated payment of the death benefit. If diagnosed with a terminal illness at some point in the future you may be able to access some of your coverage, up to 50% of the coverage amount.
  • Level Term Insurance
    • This provides additional term coverage to a whole life plan. This additional term coverage is cheaper, builds no cash value, and is in force for a specified "term" or duration of years.
Upon the passing of an insured, the beneficiary should contact Clever by calling us at 1-833-MYCLEVER (1-833-692-5383), or email us. To assist us in providing the best possible service, we'll need the name of the insured, the date and cause of death, and the name, address, and telephone number of the primary beneficiary (ies).
Simply put, we want to work with your beneficiary to receive the necessary documentation and pay as quickly as possible. The benefit of your policy can be paid in several ways at the choice of the beneficiary. There may be an immediate need for the entire lump sum to pay for medical expenses or funeral costs, for example. After a traumatic loss, many beneficiaries choose to take a breath and avoid hasty decisions. Proceeds can be left to earn interest, to set a payment stream up for a designated number of years, pay a lifetime income, or pay a designated amount as requested. Beneficiaries can withdraw as much of the death benefit as they wish and leave the remaining balance with the company under an interest option, with the understanding that they can withdraw the remaining balance at any time. The money earns interest until the beneficiary chooses to withdraw it. The proceeds can also be put into an annuity to create an income for the beneficiary's lifetime or for a specific period of time, again, at the choosing of the beneficiary. Every situation is unique, so flexibility is key.
No. We recommend that an adult be named as a beneficiary. If the desire is to pass proceeds on to a minor child, please use an adult as an informal trustee. This person should be the expected care giver if parents are no longer alive.

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