What are the Personal Uses of Life Insurance?
There are many personal uses for life insurance, from replacing your loss of income when you die to paying for your child's education. Below, we examine 10 reasons you may need life insurance and provide tips for choosing the right policy for you.
10 Reasons You May Need a Life Insurance Policy
You may have personal use for a life insurance policy if:
- You’re considering starting a family
- You have substantial debt. Life insurance death benefits can be used to pay off all types of personal debt
- You’re a homeowner with a mortgage
- You are your family's primary earner — life insurance can help replace your income if you die
- You already are, or are planning to, pay tuition and other educational expenses for your child or other dependent
- You’re a stay-at-home spouse or parent that provides valuable domestic services that would otherwise cost the family unit a substantial of money
- You’re elderly and don’t want to leave the financial burden of your funeral to your loved ones
- You own a business
- You're planning your estate
- You changed jobs or want to supplement your employer life insurance coverage
Choosing The Right Policy
Some people require coverage for a short amount of time, while others require coverage for the long term. There are various types of life insurance policies to choose from, and choosing which type is right for you will depend on what purpose you want your policy to serve.
The two broad categories of life insurance are permanent and term.
- Permanent life insurance provides coverage for your entire life (as long as your premiums are paid in full and on time) and accrues cash value.
- Term life insurance provides coverage for a specific term (generally between five and 30 years). If you outlive the term of your life insurance policy, your beneficiaries will not receive a payout. Additionally, term life policies do not accrue cash value. They do tend to be less expensive than permanent policies.
A licensed agent can help determine what type of coverage is right for you. Learn more about your options or request a quote by calling 1-855-303-4640.
*Applications for insurance may be subject to acceptance by insurer. Rates and coverage amounts will depend upon the carrier selected.