The Importance of Life Insurance
Life insurance might not be something we think about so much when we’re young, but as we grow older it’s clear to see there are major benefits to having a great policy. Not only does it add great peace of mind, but it’s also a fantastic safety net for your family and loved ones should anything happen to you. Life insurance is a huge part of having a great financial plan, and there are plenty of policies out there which offer great coverage.
If you are in the position where your loved ones depend on you financially then to put it simply, life insurance is a necessity. Life insurance replaces your income when you die, which is particularly important if you have a young family. It’s also useful for leaving an inheritance, and even if you don’t have any other assets to pass onto your heirs a life insurance policy could provide them with the financial stability that they need.
Death shouldn’t have to mean debt, and by taking out a life insurance policy you’ll be safeguarding the future of your family in what would already be a very emotional and tough time. Anything can happen at any time, so investing in quality life insurance can at least put your mind at ease and leave you with the feeling that your family would be okay financially were you to pass away. Life insurance could also end up covering the costs of funerals, taking the stress away from your family in what would already be a very hectic and rough time.
When it comes to policies there are a few different types and you’ll have to take the time to assess each one and see what’s right for you. The most popular is term insurance, which pays out when a policyholder dies within a set period of time. The majority of policies run between 10 to 25 years, and you can specify how long you want your term to be. If you do happen to die during the term then the policy pays out the amount agreed at the start, known as the “sum assured”. If you live beyond the term then the cover expires and you’ll have to invest in a new one.
There are three variations of term insurance. Level term insurance, where the “sum assured” is the same amount in the final year of the policy as it was in the first. Decreasing term insurance, where the pay-out is reduced over time and finally increasing term insurance, where the pay-out rises over time to keep up with the rising cost of living. This is often the most expensive form of term insurance.
You’ll also need to decide how much cover you’ll need, and to do this you’ll have to add up any debts that need repaying and work out how much your family would need to maintain their lifestyle were you to pass away. It might all seem like a hassle now but life insurance is something which can’t go ignored. If you want to be safe in the knowledge that your loved ones are protected in the event of your death then the importance of life insurance cannot be underestimated.
If you’re struggling with the thought of life insurance and aren’t sure where to look or how to get the best deal, make sure you contact Council Tax Advisors today. We can give you free and impartial information about how to get the best policies that’ll leave your loved ones fully protected if the worst should happen.