Though no one would want to think about their own death, taking life insurance to cover such an unfortunate event is a prudent thing to do. Life is unpredictable and bad things may happen when you least expect them. With your life insured, the loved ones will at least be financially sorted out if you happen to die. At the same time, they will probably have enough to pay off your outstanding debts and mortgages.
The idea is to ensure that the loved ones who are financially dependent are provided for even after you are no more. From the day to day expenses to the costs of education, housing and illnesses, you need them to be covered in every possible aspect. Whether you require life insurance is a matter of individual circumstances and choice but is always wise to be far-sighted and have it. Here are some good reasons that you must take one.
You have hefty financial obligations
Having hefty financial obligations is one of the reasons to get insured because you would not want your loved ones to bear the brunt of your outstanding responsibilities after you. Assess your outstanding liabilities to determine whether your saleable assets, investments, and savings would be enough to mitigate them after your death. If this is not the case, a life insurance policy becomes a must.
You are buying a new home
Buying a property involves a mortgage, which becomes a liability that you need to pay over time. In case the mortgage is in your name and you happen to die before it is cleared off, the burden will fall on your loved ones. By taking a policy along with the mortgage, you ensure that they will be able to meet the commitment of repayment after you are gone.
You are getting married
Getting married is one of the major milestones as it attaches you to your spouse, emotionally and financially. Taking a life insurance policy gets your spouse covered if you were to die unexpectedly. This becomes all the more important if you have a stay-at-home partner who is financially dependent on your income. You can opt for a single or joint policy, though the latter is a smart option as it covers you and your spouse for a lesser premium. However, there could be complexities if you happen to separate.
You have dependent children
If you are having a baby or already have children, you would want to provide for their upbringing if something happens to you. It does not matter what age you are having kids because older parents have a greater need to be covered. There are options for getting insured at a later age too and the sooner you get cover, the better it is. According to Karren Hale from Claybrooke.org.uk, age specific policies are growing in popularity in the life insurance field.
You are becoming a grandparent
Another good reason to get a life insurance policy at a later age is when you are having grandchildren and want to gift them a legacy after you are gone. Getting insured at this stage also gives you the peace of mind that your next generations will be financially compensated even if they need to spend money on your treatment and care.
You have parents who are dependent on you
Life insurance is a good thought for people who want to provide for their spouse, children, and grandchildren. But it is also an absolute necessity if you have aging parents who need physical and financial support. In a situation that they outlive you, they would probably need money to be looked after well. Ideally, you need a policy that names your parents as the beneficiaries in such a case.
You have a family history of illness
Taking a policy would be a good decision if you have a family history of illness or suffer from a pre-existing medical condition. The policy may cost more in such a case but it does give your loved ones a risk cover. Before you take up policy while suffering from a condition, make sure that it is covered. An experienced life insurance agent can guide you about choosing the right policy in this context.
Beyond a risk coverage tool, life insurance can be a smart way to save on taxes as well. This is another reason that you may want to take a policy because it serves the dual benefit of saving up and covering your loved ones after your death as well as reducing your tax burden while you are alive. When you do decide that you need life insurance, picking the right one really matters and so does timing it right.
To read more on topics like this, check out the lifestyle category.