10 Important Reasons For Taking Out Life Insurance

Insurance in general is designed to protect you and your family from disasters and the financial burden which so often follows. There are many different types of insurance of which the basic and most important is considered to be life insurance which provides for your family after your own death.

Since there are certain financial commitments you have to meet throughout life you need also to provide something even in death to secure the family home, to assist the family to meet expenses for a while, to provide for dependent parents or to provide security for your spouse and possibly children.

These financial obligations might include things like your funeral expenses, unsettled hospital and other medical bills, mortgages, business commitments and providing for the education expenses of your children.

Just how much insurance you need will vary depending on your lifestyle, income and financial needs, debts, and how many dependents you are supporting. As a general rule you should have insurance coverage that is five to ten times your present annual income.

An important part of your financial planning, whole life insurance provides peace of mind for any uncertainties in life.

1. Life insurance correctly planned will provide funds in the event of premature death to deal with monies due, mortgages and day-to-day living expenses. It provides protection for the family you leave behind and acts as a cash resource.

2. It gives security for your hard earned estate on death by providing a tax free cash sum that can be utilized to pay estate and other death duties.

3. Life insurance plans can also have a savings or pension provision that can help to fund you in retirement.

4. In some cases policies have riders such as restricted coverage of term insurance or critical illness for a child or spouse. There are particular rules considering eligibility for riders that you will need to determine clearly.

5. In case of bankruptcy the cash value, as well as death benefits, of any insurance policy is exempt from creditors.

6. Holding a valid insurance plan is considered as having a financial asset and this improves your credit rating when you arrange health insurance or a home loan or business loan.

7. Term life insurance has double benefits as it protects and you can get your money back at important points in your life.

8. Life insurance can be arranged in such a manner that it will cover even the expenses of your funeral.

9. Insurance protects your business from financial loss or any liabilities in case a business partner dies.

10. It can go a long way towards keeping a family’s standard of living if one partner dies unexpectedly.

Insurance forms a vital part of good financial planning but you do have to evaluate your personal risk and your longer term commitments.

Three Reasons For Buying Life Insurance

We live in economically uncertain times and finding financial security has become increasingly tough. Baby boomers have seen their life savings dwindle during the 2007 economic crash. Worldwide natural calamities and political upheavals have made life more fragile than ever. That’s why it is important now, more than ever, to consider buying a life insurance policy.

Life insurance is used to resolve the financial gap that would occur if an earning member of the family or a stay-at-home spouse were to die unexpectedly. The loss of income this would incur would have a severe impact on the family’s financial status. For instance, if you died with outstanding loans or mortgages, the burden of paying off those loans would fall on your family. Calculating just how big a financial impact your death would have on your family is the key to life insurance planning.

1. Purchase life insurance for its numerous benefits

The first obvious reason to buy a life insurance policy is to protect your loved ones from a financial catastrophe. But life insurance has many more benefits you should consider:

Your life insurance coverage can serve as a partial replacement of income to the surviving members of your family, whether it is a spouse, your children or elderly parents who depend on your income.
Life insurance can pay for your funeral expenses. Burial costs and funeral services can be very expensive; death benefits can help offset those costs.
Life insurance can be used to pay off estate taxes. If you have a large estate, your beneficiary could use the coverage to pay off estate taxes and avoid liquidation of assets.
You can use your life insurance as an inheritance to pass on to your children or grandchildren so that they have a good start in life.
You can use your life insurance policy to make a generous donation to your favorite charity. Many people designate proceeds to their church or a relief organization.
If you are an elderly couple, death benefits from your life insurance policy can offer greater financial security to a surviving spouse. It can compensate and prevent a surviving partner from eating into retirement funds to pay for unexpected medical costs.

2. Purchase life insurance because it is totally affordable

This is the best time to purchase term life insurance. According to the Insurance Information Institute, from 1994 term life insurance premiums have plummeted 50 percent for standard-risk term insurance. A term life insurance policy is the most affordable life insurance policy.

Term life insurance is the most basic insurance policy you can buy and the simplest to understand. You pay a premium based on your age, sex, health, lifestyle, occupation and other factors that may be incorporated into a life insurance company’s underwriting process. In return, your family will receive a predetermined death benefit after you die.

If you are young and in good health, there’s a good chance you’ll be applicable for the best life insurance rates. You’ll be able to lock in those rates for a long time if you take a level term life policy covering a 30-year term period.

3. Purchase life insurance because it is convenient.

Let’s face it. Convenience plays a huge factor! Most of us lead very busy schedules and are driven by convenience. We need a process that is convenient and quick. Online life insurance quote providers offer just what you need�”convenience. Such providers will take just a few moments of your time. You will be required to fill in an online questionnaire. Once this is submitted, you will instantly receive the best life insurance quotes from top-rated life insurance companies that suit your personal situation.

Most of us are tech-savvy these days and the introduction of an electronic life insurance application process is paperless and can be done in the convenience of your own home or office. With e-signature, the entire process can be done online without having to meet a life insurance agent.

Conclusion

Life insurance is a competitive business. The underwriting process differs from company to company. Some companies offer a more specialized look into unfavorable health conditions and therefore can offer you better premium rates than others. Since online life insurance quote providers have an expansive database that holds information from hundreds of life insurance companies, they can easily locate companies that �favor� your pre-existing health conditions or your smoker’s status.