Why You Should Consider Life Insurance
Life insurance can be a delicate topic, but it’s an important part of a strong financial plan. Whether you think you’re in the best health of your life or have saved enough money for a lifetime, here are some reasons you should consider adding a life insurance policy.
For Your Family
Probably the most obvious reason is something you’ve likely heard before: Life insurance isn’t for you, but for the ones you leave behind. Life insurance policy benefits can help your family with funeral expenses, debts, mortgages, tuitions, or even day-to-day expenses while dealing with loss.
While many people opt for life insurance to help their family when they’re gone, life insurance can also directly benefit you in some instances as well. Whole life insurance policies include a savings option known as “cash value.” This can serve as a source of equity, meaning you can borrow money against your policy or surrender the policy in exchange for cash. However, if you do not pay back loans taken against your policy, it can reduce your death benefit amount. This is another reason to familiarize yourself with your policy details or speak with an account representative to make sure you understand all your available options.
Options to Fit Your Needs for Now or Later
Another benefit of life insurance is that because there are different types of coverage, it’s relatively flexible depending on what your needs are. Term life insurance offers protection for certain periods of time, typically 10, 20, or 30-year periods, while whole life insurance coverage is for your whole life. Term life premiums tend to be lower than those for whole life, but term life doesn’t offer the same equity options that whole life does. Both include age-based premium rates, which means that even though younger employees may be tempted to pass on coverage, they’re in an ideal position to lock in good rates. It’s important to note, however, that the premium rates for term life insurance are guaranteed to stay the same only during the Term Period you select at enrollment. After that period, they will increase. Check out the video below for more information on life insurance types and coverage options.
This blog is up to date as of October 2020 and has not been updated for changes in the law, administration or current events.
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