10 Important Reasons Why A Person Needs A Life Insurance Plan
Post date: March 29th, 2009 |
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Insurance in general is designed to protect you and your family from disasters and their financial consequences. There are many different types of insurance of which the basic and most important is life insurance which provides for your family after your death.
Since there are a number of financial commitments which you need to meet throughout life you also need to continue to provide something even in death to ensure the security of the family home, to assist the family to meet expenses at least for a short time, to protect dependent parents or to provide security for your spouse and possibly children.
Financial obligations might include funeral expenses, unsettled medical bills, mortgages, business commitments and providing for the education expenses of the children.
Precisely how much insurance you need will vary depending on your lifestyle, financial needs and sources of income, debts, and the number of dependents you are responsible for. In the main an insurance adviser or agent would recommend that you take insurance cover that is five to ten times your yearly income.
As an important part of your financial planning, whole life insurance gives you peace of mind for any of the uncertainties of life.
1. Life insurance correctly planned will provide funds in the event of unexpected death to deal with debts, mortgages and normal living expenses. It offers protection for the the spouse and children you leave behind and serves as a cash resource.
2. It secures your hard earned estate after your death by providing tax free cash which can be used to meet estate and death duties.
3. Life insurance plans can also include a pension or savings component which provides for you during retirement.
4. Some plans include riders such as restricted coverage of term insurance or critical illness for a child or spouse. There may be particular rules regarding eligibility for riders that you will need to determine clearly.
5. In case of bankruptcy the cash value, as well as death benefits, of an insurance plan is exempt from creditors.
6. Holding a valid insurance plan is considered as holding a financial asset which will improve your credit rating when you arrange health insurance or a home or business loan.
7. Term life insurance can have a double benefit as it protects and you can get your money back during strategic points in your life.
8. Life insurance can be planned such that it will even cover the expenses of your funeral.
9. Insurance can protect your business from financial loss or any liabilities in the event of the death of a partner.
10. It can contribute towards preserving your family’s life style when one contributing partner suddenly dies.
Insurance forms a vital part of good financial planning but you do have to evaluate your personal risk and your long term commitments.
Plans, like a whole life insurance plan, can provide you with the security you require for your spouse and children and also act as a fantastic form of financial security against which you can borrow. So, why not request some of the best life insurance quotes on offer today.