Life is fragile – no one is guaranteed tomorrow. Tragedy and loss can make survivors feel like they’ve lost control of everything they have known. In the midst of grief, loved ones may feel overwhelmed by financial stress, whether due to debts, medical bills, loss of income, or concern over new expenses that may arise as a result of their loss.
While there may be nothing you can do to prevent tragedy, life insurance can help you protect the people you love in your absence. Some policies even offer living benefits that can help with financial planning long before the passing of an insured. At Feldbruegge Insurance, we cannot help you predict the future; but we can help you manage it. Contact an independent agent at our office to request a life insurance quote and find out which policies may be right for you.
Who Needs Life Insurance?
Life insurance is appropriate for most adults, including anyone who has financial dependents, provides household services, expects to have future financial dependents, would like to leave a financial legacy, or who needs to protect business partnership interests. Because life insurance eligibility can change due to age and health, planning ahead can help you get the most value from your coverage and help safeguard against financial uncertainty.
What Would Happen to Your Family After a Loss?
Imagine the financial toll your family would experience in the event of a sudden, unexpected loss. Could you afford to pay for a funeral and final expenses? Would the loss of a loved one also mean a loss of income? How would this affect your family’s ability to pay bills, travel, live comfortably, and save for the future? Would a stay-at-home parent be forced to go to work? Would a working parent be forced to hire domestic help, such as a cleaning service or childcare provider? Having the right coverage can help you cover these types of expenses and more, giving loved ones greater comfort and control over their finances and living situation.
Should You Purchase Life Insurance?
Families with working parents and children living at home usually understand the importance of life insurance. Perhaps you do not yet have a family, though, and are considering whether you should purchase a policy. Maybe you are an empty-nester who is working to support an aging parent and also secure a comfortable retirement for yourself and a spouse.
Consider this: The onset of an illness or a sudden change in health could disqualify you from coverage. Likewise, the cost of life insurance tends to increase with age, making it more expensive in the future. Purchasing coverage now means you can lock in your insurance protection for decades or even for life, regardless of how your health may change over time. If you put off purchasing coverage and the worst happens, you put loved ones at risk. If you put off purchasing coverage until a later time, you risk paying far more for coverage or being denied due to health reasons.
Employer Coverage vs. Private Coverage
Employer life insurance can be a valuable asset, but it should not be confused with the benefit of having private coverage, too. If you have an employer policy – perhaps one that is paid for or mostly paid for by your job – you should still explore private coverage options with an independent agent. Unlike employer-based coverage, private life insurance is never tied to your continued employment with a particular company. Furthermore, private insurance can be customized to your needs, whereas employer-based life insurance is often blanket coverage with minimal benefits that fall short of what you would actually need in the event of a loss.
Choosing Coverage Amounts
Work with your independent agent to determine how much life insurance coverage you may need. Consider your long-term financial goals and how much it would cost to achieve them. Examples include:
- Paying for final expenses
- Providing financial support for your family
- Paying off household debts
- Covering a major purchase, such as a child’s college tuition
- Saving for a spouse’s retirement
- Leaving a family inheritance
- Creating a financial legacy, such as a scholarship
- And more
Life Insurance Types
There are different types of life insurance. Most are defined by their coverage duration – term or permanent. Depending on your needs, your agent may recommend one or both.
Term Life Insurance
Term life insurance provides high limit coverage at competitive rates for a set term – often 20 or 30 years. At the conclusion of this term, the coverage expires. If an insured dies during the term, the beneficiaries receive a large death benefit. This type of coverage is often purchased during working years when children are still home, families are growing, and households are still working to build savings. Term life insurance does not accumulate cash value, but it can be purchased alongside permanent life insurance, which does.
Permanent Life Insurance
Permanent life insurance provides a lifetime of benefits at stable rates. This coverage never expires so long as premiums are paid. Policies often build cash value against which policy-holders can borrow or even cash-out. Generally, permanent life insurance rates are higher with lower death benefits compared to term life, but the cash value and lifetime coverage regardless of health changes make it an attractive option for many.