Are you one of the estimated 95 million Americans without life insurance or sufficient life insurance coverage? If so, it’s time to consider why:
- If thinking about life insurance reminds you of your mortality, consider the important silver lining that life insurance provides: financial security for your loved ones in the event of your passing.
- If you think that life insurance premiums won’t fit into your budget—you may be surprised. Life insurance is generally quite affordable, especially if you are healthy.
- If you’re not sure that life insurance is necessary for your specific situation, think about how the loss of your financial support may affect your family—regardless of whether you have traditional dependents.
With so many different types of life insurance policies available, it’s easy to find one that fits your specific situation. The following life-stage guidelines from LIMRA (Life Insurance Management Research Association) can help you determine how life insurance can benefit you. If you already have life insurance, use this information to determine if your existing coverage needs to be updated.
You Own a Business
In addition to protecting your family, life insurance can protect your business. If you, or a key employee, pass away life insurance can help in a number of ways. For example, if you have co-owners of your business, a life insurance policy can be structured to fund a buy-sell agreement. This would ensure that the remaining business owners have the funds to buy the company interests of the deceased owner at a previously agreed upon price. As such, the surviving owners get the business and the family of the deceased owner receive a monetary payment. In case of the death of a key employee, key person insurance, payable to the company, provides the owners with the financial flexibility needed to either hire a replacement or to work out an alternative arrangement.
If you’re a single person providing financial support for aging parents or a sibling with special needs, life insurance can continue this support after you pass away. If you are carrying significant debt that you wouldn’t want to pass on to family members, life insurance can provide the funds to settle your debts. Insurability is another reason to consider life insurance when you’re single. If you’re young, healthy, and have a good family health history, you should be able to get very affordable rates on a life insurance policy.
Even if you and your spouse don’t have children, life insurance provides a financial security net. Consider this, in the event of your death, would your spouse’s income allow them to pay off debts like credit card balances, mortgage and car loans, plus monthly household expenses and utility bills? If not, a life insurance policy offers important financial protection.
You’re Married with Children
Most families depend on two incomes to make ends meet. If you died suddenly, could your family continue to meet their financial obligations? Could your family continue their standard of living on your spouse’s income alone? Would their plans for the future—like attending college still be possible? Life insurance makes sure that your family’s plans for the future don’t die when you do.
You’re a Single Parent
Life insurance is key for single parents who need to provide financially for their children. Just like a married couple with children, life insurance provides critical financial security for the dependents of single parents.
You’re a Stay-At-Home Parent
Stay-at-home parents may not earn a traditional salary, but that doesn’t mean they don’t contribute financially to their families. Childcare, transportation, cleaning, cooking, and other household activities are all important tasks, the replacement value of which is often severely underestimated. With life insurance for a stay-at-home parent, proceeds from the policy can be used to help pay for some of these services as well as providing money that can be used for future education costs or other expenses.
You Have Grown Children
If your children are financially independent, and you no longer have to worry about college costs or mortgage payments you may think that you don’t need life insurance. This is not necessarily the case. Consider if you died now, would your financial reserves, without life insurance, enable your spouse to maintain their current lifestyle and retire comfortably? If not, purchasing (or maintaining) a life insurance policy is a smart move.
Depending on the size of your estate, your heirs could be hit with an estate tax payment of up to 45 percent after you die. The proceeds of a life insurance policy are payable immediately, allowing heirs to take care of these taxes, funeral costs and other debts. Life insurance proceeds are also generally not subject to income tax and won’t add to your estate tax liability if properly structured.
Still need convincing? Try this online tool and start planning your LIFE today!
So let’s talk!
Now that you’re aware of the different types of life insurance available and how a life insurance policy can provide protection in a wide range of situations, let’s talk! Contact us today! Our insurance professionals can help you understand which life insurance policy is right for you and answer any questions you have.
Tasha Crusinberry has been a customer service representative with Kemner Iott Benz since 2008, specializing in Personal Lines and Life & Health Insurance. Tasha enjoys raising her little ones, Aaralyn, Wayland, and Gwendolyn, spending time with her husband, Dan, and in her spare time, picking up a good book or watching a movie.
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