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Education Centre How does Life Insurance protect my loved ones?
Education Centre How does Life Insurance protect my loved ones? | How does Life Insurance protect my loved ones? |
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Life is full of uncertainties and the best thing to fight it would be to ensure that your family does not suffer in case something happens to you. This can be done by getting adequate amount of Life Insurance Protection for your loved ones which will provide a lifetime of financial security to those left behind.
The sole aim of Life Insurance is to replace the insurer’s earning power when he is no more. True to it’s name, Life Insurance softens the blow to the family of the deceased by providing him a financial cover which will shield them for along period, as long as the insurer wanted.
Life Insurance provides for funeral expenses Life Insurance Protects the loved ones by not letting them fall into any financial trouble once the bread earner is no more. Life Insurance covers even the funeral expenses so that you can bid adieu to the departed soul without having to worry about the expenses in the hour of grief. Life Insurance provides for monthly Income Just like you would have brought a monthly pay check home and took care of your family month after month, Life Insurance too ensures that your family has money to take care of themselves month after month, and year after year. The payout would depend upon the amount which was decided at the time of issuing of the policy. Life Insurance provides for Education of Children You, at the time of buying the policy, can set the duration for which you want your family to be paid in case you are no more. This can depend upon a number of factors. For example if you have small kids at the time of buying the policy, you would want them to have a trouble free education backed by ample funds to see them thru’ their college education. You can then calculate the years and set the duration of Insurance payout till the time you feel your children will be safely ended college education and would now be ready to earn a living. Life Insurance provides for the perks you would have earned While calculating how much insurance you need, don’t make the mistake of just calculating the total salary you would have bought home in the next seven years or so. Be careful to add more amount to cover inflation as well. Also, while in job you would earn many perks as well which will go a long way to contribute to the happiness and prosperity of your family. You can make an assumption of how much your perks will earn you over the next seven years and remember to add this amount too in your total insurance need. This would ensure that your Life Insurance Policy also provides for the perks you would have earned and contribute to the expenses of your family. Life Insurance can provide for Investment as well Whole life policies often have a combo of life cover as well as an investment fund. One part of it provides for a fixed sum to your family after your death. The other part builds a cash value from the investments which your Insurance Company made of which your money was a part. This amount is not taxed. However, the investment role of a Life Policy must be secondary and you must NOT buy a policy for the sake of investment. Life Insurance can pay for the mortgage In case you are making mortgage payments while you are alive, Life Insurance takes care of the same once you are no more. This means your family will not have to worry to clear the huge debt of mortgage and your Life Insurance Policy will pay for the same. |
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