Why Life Insurance is a Must

Wednesday, April 14, 2010

There is a definite list of top reasons why life insurance is not an option to think about “one day maybe”, but a must for every person. The most obvious one is that none of us are immortal and we do not choose our time; so if for no other reason, a policy will provide cover for the costs of a funeral. This is definitely not the only reason to invest in a policy, there are others of equal importance.


Life, home and family

The normal progression through life for the majority of people is to get married, have children and buy a house. These are three top reasons to invest in life cover. In the unforeseen event of your death this allows you to provide for your spouse and children during a very difficult time. If you own a house, whether you are single or married, the mortgage will be paid, which is very important for your beneficiaries. Secondly, this provides a paid home for your spouse and children if you are married. Sufficient life cover also provides them with an income so that they can continue a reasonable lifestyle and also provide for the future education of young children.


Peace of mind regarding income and debts

Life insurance is a form of security that gives you peace of mind. If you plan your life cover wisely you can make provision for future loss of income for your beneficiaries for years to come. Mortgages are not the only thing to worry about and in the event of untimely death there are credit cards, car payment and other lines of credit that must be paid from your estate. Adequate life cover ensures that your spouse or partner will not be burdened with these payments.


Reasons not often though about

No matter your financial status, an estate is subject to taxes and maybe also to legal costs and probate. Live cover will put tax free money in the hands of your beneficiaries so enable them to deal with any costs arising. Life insurance must be invested in when you are in good health and at a young age for the older you are when you start, the more expensive it will be as age and health plays an important role in premiums. You can provide for your parents through your life cover. It is a way to ensure that in the event you are not around to care for their needs in old age, the finances will be available. Naming your parents as beneficiaries could provide much needed old-age or frail care for them.