An Overview of Life Insurance
It goes without saying that those who enjoy both youth and robust health are less likely to ponder the consequences of death. However, the fact is death can happen at any time regardless of age, health and no matter how careful one might be. When you die, loved ones are often left behind who depend on you, especially if you’re the breadwinner. Often, they have come to depend upon your financial support and, without it, they would needlessly suffer. Think of all the major expenses your loved ones can face without your usual support, such as that big wedding that was planned for a son or daughter or the looming retirement of a spouse that may need be postponed if you pass away and do not carry good life insurance coverage. If you wish to ensure that your family is well cared for after you pass away, life insurance can be the very best way to do it.
Types of Coverage
There are several kinds of life insurance options available on the market but the two main types are known as “universal” and “term” coverage. Universal life coverage is distinguished by the fact that it stays in effect and does not expire as long as you make your premium payments consistently and on time. It also has the added advantage of gaining cash value as time goes on. The built-up cash value can be utilized for investments, to prepare for retirement and so on. This makes universal coverage quite a bit more helpful for those who choose to pay a bit extra for the added benefits. Also, keep in mind that a part of each premium payment is allocated to the savings component of this kind of a policy, which means one can enjoy more benefits and flexibility, even to the point of using the policy to borrow money if needed. Due to all these unique aspects of a universal life policy, the premium payments are often more than what one pays for term life coverage. Term life insurance has a policy expiration date with the lengths of the “term” being anywhere from 10 to 30 years. Term life is a policy type that is generally meant to assist a loved one’s survivors in paying for the inevitable costs of dealing with the aftermath of death, such as funeral expenses, left-over debt, and so much more.
With both kinds of coverage, you will be well-served in taking account of your policy’s specific exclusions. Exclusions are designed to protect the insurance company from inappropriate loss and potential fraud- Essentially, they spell out the instances in which payments may not be provided to beneficiaries.
Both types of policies allow you to choose the benefits that you’d like your named beneficiaries to receive. For instance, you might opt for a plan that has $100,000 or a whopping $500,000 in benefits; it’s simply up to you to decide what is best for you and your family. When choosing a coverage level, you would be well served in developing a plan that takes into account how you expect your loved ones to use these funds. For instance, some might need monthly financial help after the breadwinner passes, while others may wish to pay off debt, help a child handle college tuition expenses, or even to take that long postponed vacation.
No matter your present age, it’s always a good time to obtain quality life insurance coverage. Taking care of these steps now can provide your loved ones the peace of mind in knowing that, should you pass away, they will have the financial wherewithal to meet obligations, realize objectives and to enjoy the lifestyle to which they’ve grown accustomed.