It’s not something pleasant to think about, but if you’re the breadwinner of the family, one part of planning your financial future is considering what will happen to your loved ones if you were to die. Would they be able to survive without your income? Sadly, many families (four in ten, according to one estimate) would immediately have trouble paying their bills if the primary wage earner died.
One simple way to protect your family after you’re gone is to purchase a life insurance policy.
What is life insurance?
A life insurance policy is simply an agreement that an insurance company will pay out a certain amount of money after the death of the insured, as long as the premiums are current. The main goal of life insurance is to take care of those who depend on you after you die, by providing funds to pay off debts (including such things as a car loan or a mortgage), end-of-life, and other expenses. Many people with children also want to provide enough money for them to complete their educations and become independent.
Most life insurance is either term life or permanent life, also known as whole life. You purchase term insurance for a specific period of time, such as 20, 30, or 40 years. Term life is good for people who need coverage only for a specific amount of time—until children graduate from college, for example. Term policies contain an expiration date, and will only pay out if the insured person dies before that date. After the policy ends, there is no more death benefit. They’re generally quite affordable, especially for younger people.
As long as you pay the premiums, permanent life insurance provides lifelong protection. There are a few other benefits to a permanent insurance policy, and if you absolutely must have a life insurance policy in place when you die, permanent life insurance may be the way to go.
Which type and how much insurance you need depends on your life and financial circumstances and goals. A licensed life insurance agent can help you decide which is best for you. Please call L & M Insurance Group at 813-672-4100 if you’d like to learn more.
In the meantime, here are a few basic facts about life insurance that you might not know:
It costs less than you think.
Many people overestimate how much life insurance costs. Term policies are very affordable, especially for younger people. NerdWallet noted that a 20-year, $250,000 term policy for a healthy 30-year-old cost just $160 a year.
It’s not that hard to get, even if you have some health issues.
Unless they are severe, your health issues shouldn’t keep you from qualifying for a life insurance policy. You will pay more than someone with no issues, but the cost may still be surprisingly affordable.
Worried about a lot of paperwork and a medical exam? Simplified underwriting practices make it much simpler than it used to be, and many policies don’t require a medical exam.
Group insurance through your employer may not be adequate.
In most cases, life insurance won’t go with you if you change or lose your job, or if you retire. In addition, if you have a young family, the coverage amount on a group policy may not be enough to see your family through.
You should review your life insurance policy from time to time.
As with all insurance policies, you should review your life insurance policy regularly to be sure it continues to meet your financial needs. This is true especially after a significant life event such as a marriage, birth or adoption of a child, or a divorce. You’ll also want to verify that contact information, beneficiaries, and other details remain current.
L & M Insurance Group is a full-service agency, and in addition to home, auto, umbrella, and business policies, we also offer life insurance. Please give one of our licensed agents a call at 813-672-4100 or click here if you’d like a life insurance quote.
