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Every household should have a life insurance policy in place. Sometimes we don’t like to think about it because we don’t want to address the inevitable, and sometimes it can seem too confusing to tackle. But scrap the hard sellers, think about your family, and get sensible when it comes to working out your finances. All it will take is one afternoon to sort out a policy, and it will then give you peace of mind going forward. Still not convinced? Here are some of the reasons why you should never skip on life insurance.
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Family That Rely On You
If you have family that relies on you financially for support with mortgage payments, utility bills and childcare, then it is essential that you have life insurance in place. If you are married or have children, then it goes without saying that you need life insurance. The same goes if you have parents in ill health that rely on you, if you have an ex-spouse you share children with, or if you work with a business partner.
Final Expenses
Life insurance does not just help those you leave behind. It also aides in settling any outstanding debt, and final expenses for your funeral. As we are now living longer, we may put off dealing with these issues. But take a look here lifeinsuranceforseniorsover80.com for lots of information on life insurance for seniors. Seniors may want life insurance to help with funeral costs, but could also need it in place to pass on estate or businesses to their children. Regardless of age, life insurance can soften the difficulty of the financial burden if an unexpected death does occur.
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What Are The Roles In A Life Insurance Policy?
There are three main roles in a life insurance policy. The insured, the beneficiary and the policy holder. The insured is the person who the policy covers. When the insured person passes away, the insurer will pay a death benefit. This will be based on the deceased’s physical condition and financial status. The beneficiary is the person that receives the death benefit when the insured person has died. This beneficiary can be one or more persons. These can be changed at any time in the insured person’s life. The policy owner is the person insuring their own life, business, a family trust or a child. In the majority of cases, the only person that can change the life insurance agreement is the policy owner.
Term Life Vs Permanent Life Insurance
Term life insurance is the easiest option to get your head around and the most affordable. But permanent life insurance is the more expensive but also the most well-known. Take a look here for a more in depth guide on the two: money.usnews.com/money/blogs/the-smarter-mutual-fund-investor/2014/02/26/which-is-better-for-you-term-or-permanent-life-insurance
But in short, term life covers you for a certain period. It is predominantly designed to help your dependents if you die prematurely. It can be taken out for anywhere between 10 to 30 years. If you die within that time, your chosen beneficiaries receive the death benefit. If you do not die, the policy is simply terminated. Choose this option for the time when your family is most dependent on you. Permanent life insurance, on the other hand, means taking out a policy that covers you lifelong. It also contains an investment known as a cash value. This cash value grows as your policy continues and is tax-free while it is accumulated. You can take money out of your cash value while you are alive. But you will need to pay this back with interest before you die for your beneficiary to receive the full death benefit.
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