When planning for the future, your efforts probably go toward saving for retirement or a down-payment on your dream home – as they should. However, there is always the chance that things may not unfold as planned. If you or a member of your household unexpectedly passes away, what type of financial burden would be left for surviving loved ones? At Owens Insurance Agency, we help you find answers to the questions that many are afraid to ask and point you toward life insurance coverage that gives your family the assurance it needs to face an uncertain future.
How Can Life Insurance Benefit Your Family?
There are several ways life insurance can benefit your household. For many, the most important advantage it offers is protection against financial hardship in the event of the insured’s death. That could look like income replacement for a stay-at-home spouse who wishes to continue serving in a domestic role rather than entering the workforce after a loss. It could mean paying for final expenses, such as medical bills and funeral costs, so as not to leave loved ones burdened with debt.
However, life insurance can offer much more than a death benefit. With the right coverage, you may be able to leave a financial legacy following your death, whether it is making a large donation to your favorite charity, funding the start of a new foundation for your favorite cause, leaving an inheritance for your children, or paying for college tuition and other major life expenses for your descendants.
Some life insurance policies even offer living benefits that can generate financial growth and asset accumulation over time. Some policies build cash value from paid premiums, and there are others that provide an investment component for greater wealth accrual. When the time comes, you may decide to cash out the value of this type of policy or even borrow against it to pay for a large or unexpected expense.
How Much Life Insurance Should You Purchase?
Before you can determine how much life insurance you should purchase, you first need to know what your family stands to lose in the event of a sudden loss. We encourage clients to consider the financial ramifications of an immediate loss, as well as a loss that occurs a few years from now or after a long medical battle. Would your spouse be able to retain the house you live in? Would your children still be able to go to college? Would your business stay in the family?
Generally, your life insurance should be enough to pay off household debts, cover final expenses, and continue supporting your financial dependents despite your absence. You may also need coverage that achieves other financial goals, whether it is funding a spouse’s retirement or protecting your family’s financial interest in a business partnership.
Employer Coverage vs. Private Benefits
A minority of the general population own a private life insurance policy. That is because of those who do have life insurance; many look to employer-provided coverage for financial security instead of a private policy. While employer coverage can be beneficial, it may not fit the needs of your family – particularly due to low benefit amounts and employment contingencies associated with coverage. What would happen if you lost your job and your employer-provided coverage? The older you are when this occurs, the more expensive coverage may be. Furthermore, you may not even qualify for a private market policy if your health has deteriorated or you have received a medical diagnosis that affects your eligibility for coverage.
We recommend playing it safe when it comes to protecting the most important people in your life. Take the reigns on your life insurance coverage by finding an individual policy customized specifically for you.
What Types of Life Insurance are Available?
There are different types of life insurance. Understanding the differences and benefits of each can help you better determine which is right for you.
Term Life Insurance
A term life insurance policy is often recommended to people who have financial dependents. This is often adults who are working or have income that supports a spouse or children. Term policies do not build cash value and are only valid for a pre-determined number of years – usually between 10 and 30. However, the tradeoff is that they usually have very high death benefits is proportionately low policy premiums. Often, term insurance policies come with as much as a million dollars of coverage or more at competitive rates an average household can comfortably afford. Many people purchase term insurance that provides coverage until a time when dependents will no longer need financial support.
Permanent Life Insurance
This type of coverage provides something term life insurance cannot – perpetuity. Permanent life insurance never expires so long as you pay your premiums as agreed. You can use this type of policy to assure a financial legacy for loved ones and coverage for your final expenses even if you succeed in living the long life you plan to enjoy. In the meantime, you can enjoy access to your own benefits by utilizing the accumulated cash value by the terms of your policy.
Minnesota Life Insurance Quotes
People of all ages can benefit from life insurance coverage. Whether you are planning to start a family, already have financial dependents, or are planning for your golden years, we here at Owens Insurance Agency can help you find a policy that fits your needs. Chances are there is a Minnesota life insurance right for you, but do not delay; premium costs and coverage eligibility is contingent upon your age and health among other factors. The longer you put off purchasing your policy, the greater the risk you take with your ability to find affordable coverage.