Like making a will, organising life insurance is not something everyone feels comfortable doing. After all, it deals about the inevitable eventuality of all life – that of death – and it’s not surprising that most people put off addressing life cover. However, if you have family dependents, there are few things more important to arrange in case the worse does happen.
Financial security for your dependants.
The most obvious reason for life insurance is to make sure your family are financially secure if something should happen to the breadwinner. Even if your partner works, the loss of one salary can cause significant financial hardship. And if you’re a ‘stay-at-home’ parent, it can still be worth your while to take out life assurance to cover the cost of childcare.
Security now and later. Many life insurance policies, in different countries, offer a ‘cash out’ option. This means that not only does it provide security in the case of your death, it also provides security in case of an unexpected financial burden in the future. This could help pay for college fees and expenses for children, or perhaps a deposit for a mortgage. This alone is a good reason for taking out life insurance.
Review your needs regularly. It’s worth pointing out that if you already have life insurance as part of a work scheme, or as part of your mortgage, it may not be sufficient to cover your entire needs. Examine your existing policies and make sure you have enough to cover all eventualities, including funeral costs. Remember too, as you go through life, your needs change and you should continually review your policy to make sure you remain covered. In a sense, your life insurance policy isn’t just there to cover you; it’s there to protect your loved ones, too.
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