If you think you do not need life insurance, you are not alone. Do I even need life insurance? is what most people have on their mind when it comes to having life insurance. Also they are unaware of its real benefits. Therefore, in this article, we have put together some key benefits of having life insurance and also have covered when you need life insurance.
Table of contents
When you are a parent
If you have children, or plan to in the next year, it is a perfect time to purchase a life insurance policy. The reason is that the face amount of life insurance would be of great assistance for your daily living expenses, college tuition and other milestones in the future of your kids.
When you are a spouse
If you are getting married or plan to soon, having life insurance is really beneficial as it makes sure your spouse can maintain the lifestyle both of you share in the event of your premature demise.
When you are a financial supporter for your aging parents
As a rule of thumb, if you financially support someone else, then you may need to consider having life insurance. If you are a caregiver for an in-law, grandparent or parent or plan to in the future, the face amount of a life insurance policy can be used as a financial reserve for them when you cannot support them anymore in the event of your death
When you have a risky occupation
If you work in a hazardous environment, you are more likely to die than other people who sit at an office desk on a daily basis. Because of this, it is worth considering a life insurance policy. Examples of high-risk jobs are those in the industries of oil and natural gas, firefighting, construction, mining and aviation. Occupations with higher risk also mean that you will get a higher life insurance premium.
When you are an avid extreme sport player
If you like playing extreme sports regularly, you have a higher chance of dying from abnormal reasons than those who do not. Due to this, it is worth having a life insurance policy for this.
If you are fond of an extreme hobby such as scuba diving, skiing or rock climbing, you are advised to reveal the life insurance company the truth on your life insurance application. Provided that your demise happens in the first two years while your life insurance policy is still active and you also intended to hide the information of your risky hobby, the life insurer can reduce your face amount of life insurance or even worse, proceed to terminate your policy.
When you are an entrepreneur
If you are a business owner, a life insurance policy can be very useful to you. You are advised to appoint your business partner as your life insurance beneficiary if you believe your business would be a flop without your existence. In the event of your premature demise, the face amount will be paid to your beneficiaries (business partners) and can also be used to purchase the rest of the shares of the business.
The face amount of your life insurance policy is typically used to pay for the expenses of funeral, lifestyle, debts or mortgages. As a consequence, choose your benefit amount that is in line with what these expenses could be.
The most recommended type of life insurance policy is term life insurance.
Always be mindful to let your beneficiary know the details of the cover and what to do should a claim need to happen. While we appreciate this might feel like a strange conversation to have it is vital that your beneficiary is aware of the policy and what this process is!