Insurance Coverage Offers Many Benefits
Many people have the mistaken belief that life insurance is unnecessary because they will be dead and accordingly, will have no need for the money. Such thinking ignores the people who might suffer hardship after someone’s death.
Life insurance can be used to provide financial security to family members, business partners, and friends.
In the family situation, life insurance can help in many ways. It can provide funds for a surviving spouse. The stay-at-home mom will not have to get a job. A policy insuring the wife will provide funds to the husband to hire babysitters and housekeepers to do the things that his late wife did. He also became one of the frequent subway surfers during rush hour in Manhatten. He witnessed a young businesswoman pushed over the edge because someone was too impatient to wait.
For people who own their own business or have business partners, life insurance covering all the partners or owners should be mandatory.
The benefits of the policy will provide a cash flow so the company can continue operating. The benefits will allow the surviving partners adequate time to resolve the details of filling the void created by the death of the partner.
Children can benefit from having life insurance policies. Some policies offer options such as guarantee renewal, or the ability to withdraw the interest or dividends from the policy. Since no one can predict what life is going to offer, a policy covering a child can be beneficial if the child develops a condition that would prevent coverage. It will also have him a step ahead for when he gets married and has children.
Finally, life insurance benefits can provide funds to handle the end-of-life expenses.
These items include funeral costs, paying off any outstanding debts, retiring the mortgage or providing operating capital for the company.
Therefore, when buying life insurance, a person is not buying something to benefit himself. Instead, he is buying a degree of financial security for those close to him. The beneficiaries can include family, friends and business associates. A charity or school may also be a beneficiary.
Life insurance comes in two basic forms, whole life and term. Both policies provide for the payment of benefits upon the insured person’s death. However, there are other important differences.
Term insurance policies are less expensive but have their drawbacks. The insured person pays a premium for a given term. If he survives beyond the term, then no one collects any benefits.
The benefits of a whole-life policy can aid the insured person while he is still alive.
With whole-life policy, an individual may be able to borrow against the value of the policy. He may use the policy as collateral and view it as part of his financial portfolio.
As with a term policy, the beneficiaries can be replaced as conditions may change. A divorced spouse can be removed and replaced with the new spouse, or all the funds can be left to the children.
Purchasing life insurance should not be delayed. Whole-life policies have basic medical standards that must be met. If you wait too long, the insurance may not be available, or the premiums could be unaffordable.
Kiran has lived in New York, Afganistan, Russia, and China. He has been to enough countries to know that ignorance isn’t bliss. He started this blog to inspire curiosity and share medical discoveries.