Life Insurance is a policy that protects against financial loss as a result of death. Upon your death, the insurance company that you have your policy with will pay your chosen beneficiary a specific lump sum, assuming all the guidelines of the policy have been met.
So, why should you consider life insurance? If you currently provide income for your family, in the event of your death, who is then going to bring that money in for your loved ones? While nobody likes to think that they might die prematurely, life is not predictable. If you are currently providing financial stability for your family, think of the difficulties they will face should you pass away.
So, why should you consider life insurance? If you currently provide income for your family, in the event of your death, who is then going to bring that money in for your loved ones? While nobody likes to think that they might die prematurely, life is not predictable. If you are currently providing financial stability for your family, think of the difficulties they will face should you pass away.
Life insurance can be used to replace income, pay off any mortgage or large debt, or to fund your children’s education needs. When you consider how much each of these can amount to, it makes sense to have a life insurance policy, to protect your family from financial difficulties.
But what sort of life insurance policy should you take out? There are two main types of policies that most insurance companies offer – Permanent Life Insurance and Term Life Insurance.
Permanent Life Insurance offers you a set Death Benefit (payment to your beneficiary) for as long as you live. The premium remains the same for the term of the insurance period and many offer guaranteed cash values, which means if you choose to terminate the policy, you will be refunded the guaranteed cash value.
Term Life Insurance also offers a Death Benefit, but only for as long as the policy is in effect. They also have adjustable premiums, based on the amount you are insured for, and many offer renewable policies.
Term Life Insurance is most often used to cover periods of time where a large loan (such as a mortgage) is taken out, or during child rearing years, to provide protection when it is most needed.
How much life insurance you need, and which type, depends on your individual situation. If you have a mortgage to pay off, and are the sole income earner, then both of these things need to be taken into consideration. Other things that also factor in are the amount of children you have, along with any other debts that would fall to your family in the event of your death.
No matter which sort of policy you choose to take out, make sure to read the fine print before deciding on a policy. If you feel that some of the conditions can’t be met, there is little point in having the policy, as the end result may be that your family will not receive any benefits upon your death. Make sure that you understand what is, and is not, covered by the policy.
No one can decide for you which type of life insurance policy you should take out, but if you earn an income, and have people that depend on you, then it is important that you have some form of insurance. While everyone hopes that they will not suffer from an untimely death, there are very few guarantees in life. It is better to be covered, than to leave your family to deal with both their grief and financial problems at the same time.
But what sort of life insurance policy should you take out? There are two main types of policies that most insurance companies offer – Permanent Life Insurance and Term Life Insurance.
Permanent Life Insurance offers you a set Death Benefit (payment to your beneficiary) for as long as you live. The premium remains the same for the term of the insurance period and many offer guaranteed cash values, which means if you choose to terminate the policy, you will be refunded the guaranteed cash value.
Term Life Insurance also offers a Death Benefit, but only for as long as the policy is in effect. They also have adjustable premiums, based on the amount you are insured for, and many offer renewable policies.
Term Life Insurance is most often used to cover periods of time where a large loan (such as a mortgage) is taken out, or during child rearing years, to provide protection when it is most needed.
How much life insurance you need, and which type, depends on your individual situation. If you have a mortgage to pay off, and are the sole income earner, then both of these things need to be taken into consideration. Other things that also factor in are the amount of children you have, along with any other debts that would fall to your family in the event of your death.
No matter which sort of policy you choose to take out, make sure to read the fine print before deciding on a policy. If you feel that some of the conditions can’t be met, there is little point in having the policy, as the end result may be that your family will not receive any benefits upon your death. Make sure that you understand what is, and is not, covered by the policy.
No one can decide for you which type of life insurance policy you should take out, but if you earn an income, and have people that depend on you, then it is important that you have some form of insurance. While everyone hopes that they will not suffer from an untimely death, there are very few guarantees in life. It is better to be covered, than to leave your family to deal with both their grief and financial problems at the same time.
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