Last posted at locallifeagents.com
Life insurance is one of the most important financial tools that you can have. In fact, without it, most financial plans are considered to be incomplete. So we put together a list of the most important times in your life that you should purchase life insurance. Pay particular attention the last event listed.
When you have children.
If you have children and you died unexpectedly, how long would your family be able to meet all of their financial obligations – from paying the rent or mortgage, to all of the other living expenses from month to month? Could they go on at the same standard of living based on just your spouse’s salary alone? What about their other plans for the future, such as college savings – would all of that still be in-tact?
With the proceeds from a life insurance policy, your children would not have to uproot from the home that they are accustomed to, would not have to change schools and start a new life simply because your survivors are no longer able to afford their living expenses.
When you get married.
The loss of one of those incomes could be detrimental to the other spouse going forward – and it would require a drastic change in lifestyle going forward. But the proceeds from a life insurance policy could help to ensure that you don’t have to uproot and drastically change your life – especially during an already difficult time.
Marriage is one of the first “life events” that should cause you to purchase life insurance – if you don’t already have it. And even if you do have coverage through your employer, it may not be enough.
For couples, regardless of whether you have children, the death of a spouse can be devastating – both emotionally and financially. So, having life insurance coverage can help couples rest easier, knowing the each will be able to still pay the bills and maintain living expenses, even if the unthinkable were to occur.
When you get a mortgage.
Because of that, if you have a spouse and / or children, you will want to ensure that they will be able to continue living in the home, even if the unexpected occurs. People will often purchase a term life insurance policy that runs concurrently with the payoff schedule of their mortgage. That way, they can be sure that if anything happens throughout the loan term, there will be funds available to pay off the remaining balance.
When you take on debt.
This could mean writing a check from your bank account, or even selling off property in order to obtain the needed funds for paying off the debt. In this case, your heirs could be out of luck if they were planning to inherit money or other assets. By purchasing life insurance, the proceeds from the policy could be used for paying off the debt so that property and other assets may be left in place for their originally intended purposes.
When you start a business.
Unfortunately, your family members may not be involved in your business. They may also not be able to sell the business – or even your share of the business – quickly or easily, leaving them without income, or worse, leaving them in a position to lose their home or other assets.
By purchasing life insurance, your loved ones will be able to use the proceeds from the policy to pay back the debt, while leaving all of their other assets firmly in place.
As a business owner, you may also purchase life insurance among the other partners or key employees in the company. That way, in case something happens to one of these top people, there will be money available for the business to carry on while the company seeks a replacement.
The most important time in your life to get life insurance is – before you get sick.
While life insurance can provide the liquidity we need to keep our families out of financial hardship, you are unlikely to qualify for the coverage that you need if you are uninsurable. So, it is important to apply before it is too late.
While there are some carriers who will take on applicants with various health conditions, the coverage amounts are limited, and the premium amount is typically quite high – often two to three times higher than a comparable fully underwritten policy.
So, qualifying for life insurance while you are still healthy can help you to ensure that your premium stays lower, and that you can get the amount of coverage that you truly need. How can you get the very best rate?
Often it pays to shop around. Just like with other types of products and services, life insurance premiums can vary from one carrier to another – even for the same coverage. We work with over 40 different carriers, so we can help you to shop and compare and find the best policy and rate for your specific needs.