Life insurance or life assurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a designated beneficiary a sum of money upon the occurrence of the insured individual’s or individuals’ death or other event, such as terminal illness or critical illness. In return, the policy owner agrees to pay a stipulated amount called a premium at regular intervals or in lump sums.
Why Is Life Insurance Important?
Life insurance policies are important because they provide many options for debt repayment, income replacement and estate planning for your family. Without a life insurance policy, your death could spell financial disaster for your heirs and could hurt their financial future.
- Income Replacement
If you are a working spouse, chances are your family relies on your income to pay bills. A life insurance policy can help to replace that income when you’re gone.
- Debt Payoff
When you die, your family will still owe the debt you have. A life insurance policy can help them pay off that debt.
- Funeral Expenses
Funerals are expensive. Life insurance policies give your family a means of paying for your funeral that won’t affect their budget.
- College Tuition
Left alone, your spouse may no longer be able to fund your children’s college savings plans. A life insurance policy can provide funds to pay for their schooling.
- Estate Taxes
If you have a large estate to pass on to your heirs, then there will be estate taxes to pay. A life insurance policy can provide the funds necessary and prevent the liquidation of your assets.
So now you know that life insurance is important, the next step you will do is to find a better insurance company who will cater to your needs and give the right insurance that’s perfect for you. I suggest you to check and try some online sites which offers a free insurance quotes.
Source: Wikipedia.com & Ehow.com
