Not everyone thinks that they need life insurance. But there are a handful of situations in life that you may need life insurance more than you might think of. Life insurance is important, as it protects your family and lets you leave them a non-taxable amount at the time of death.
How does it work?
Life insurance is a contract between you and an insurance company. Essentially, in exchange for your premium payments, the insurance company will pay a lump sum known as a death benefit to your beneficiaries after your death. Your beneficiaries can use the money for whatever purpose they choose.
What is life insurance for?
Protect the ones you love.
You buy life insurance because it’s the best way to protect your loved ones. It’s 
a financial decision…kind of. It’s an emotional decision…sort of. It’s about love and caring and the future…most definitely.
Still, millions of people buy life insurance every year for reasons that are often difficult to express. At the same time, the reasons are simple and obvious. That’s the thing about life insurance. The idea may be simple, but the reasons behind it cut deep, to our very core—almost to an instinctive level.
At the heart of it, if you’re like most people, you buy life insurance for six very good reasons.
- To take care of loved ones.
It’s about meeting responsibilities and keeping promises. You view your decision to purchase life insurance from your family’s point of view, not your own. You see life insurance as a tool that protects your spouse and children from the potentially devastating financial losses that can result if you die prematurely.
- Life insurance buys time and options.
Too often, when an income earner dies, survivors are forced to make tough, dramatic decisions—and to do so quickly. They have to make the decisions at a time when they may not be emotionally in a position to make good choices. Life insurance gives survivors a chance to adjust over time rather than having to move to a downsized home or find a new job right away.
Your life insurance gives your family choices by providing the benefits to help pay off debts, to help meet housing payments and ongoing living expenses, to help fund college educations for your children or grandchildren, and much, much more.
- Life insurance is for the living.
It’s not about you. You know that, should anything happen to you, the life insurance you have purchased is in place to protect and provide financial relief for those who must carry on without you. It’s about them.
- Life insurance is an expression of love and caring.
Because you care about your family, you want to ensure the financial security of family members if you’re suddenly not around to provide it.
- Should you die, the proceeds will help you keep the promises you have made to the people who are important to you.
By protecting their financial future, you’re enabling your loved ones to maintain their lifestyle, if something unexpected should happen to you.
- Life insurance provides cash when it’s needed most.
Your life insurance policy can deliver a specified sum of money at the exact time of need. Upon your death, your family can be assured that the amount you’ve chosen—perhaps hundreds of thousands of dollars, maybe even millions—will be there almost immediately. And that death benefit is generally not subject to federal income taxes. For example, a $500,000 policy provides $500,000 in death benefit proceeds.
What’s Next?
Now that you know a little bit more about life insurance, it’s time to think about buying something that can help protect your income, secure your future, and provide support to your dependents when something happens to you. You can spend more time doing research online and thinking about this on your own. But you can make your day even better by going the more convenient route – TALK TO YOUR FINANCIAL ADVISER NOW!