Why Life Insurance?
Life insurance is used to eliminate financial risks that occur if a bread winner dies. Most people expect to live a full life. However, millions die unexpectedly each year. The death of a bread winner often puts the mortgage at risk, jeopardizes children’s education or causes family financial hardship. Life insurance can eliminate these financial risks. If you have built, a legacy life insurance can help you protect it.
How much life insurance do I need?
You need enough insurance to eliminate the financial risks that your dependents face. If your death would cause your spouse to lose the home, life insurance should cover the mortgage balance. You might need more insurance to cover recurring costs like taxes and bills. If you want to ensure higher education for your children you need to cover that cost when it will occur. Unlike a mortgage that decreases over time the cost of education has been rising rapidly. If children have ten years before they will be attending collage you might need to double today’s costs in determining insurance amounts needed. An insurance professional can help you determine risks and identify the proper amounts of life insurance to eliminate your specific risks.
What type of life insurance do I need?
There are two broad categories of life insurance. These are Whole life and Term Life.
Whole life protects your dependents for as long as you are expected to live. Whole life is more expensive but may be needed if there is a dependent with ongoing financial needs or other risks that will persist after your eventual death.
Term life protects your dependents for a fixed period of time. Term life is much more affordable and covers risks for a specified number of years. When your mortgage is paid you no longer need mortgage protection. When your children earn their degrees your education risk has passed.
Within these broad categories are many insurance products that have different features and costs. An insurance professional can help guide you to the product that best fits your needs and budget.