All we could afford was a rundown council house. Imagine, just for a moment, your family’s life if the worst was to happen and you didn’t have life insurance?
The purpose of life insurance is to guarantee an income to your spouse and children if you were no longer able to contribute to their welfare like you do now. Think about it, if something were to happen to you, could your family afford to live in your current home? Would your spouse be able to support your family easily?
Of course, it is this time when funds are often stretched that life insurance is most needed but often that very fact puts families off from the regular commitment of insurance premiums.
But the good news is that it makes you a good candidate for term life insurance because it is the most inexpensive form of life insurance around. The premiums for term life insurance are worked out based on your age and health and are usually purchased in terms of a specific number of years – 1, 5, 10, 20 or whatever period you would prefer. The upshot is that term life insurance has the highest coverage for the lowest premiums.
While term insurance is not ideal for older individuals as prices go up substantially with age, it is the great solution for younger couples or families who have high debts including mortgages, life expenses and dependants. The insurance can cover you while your children grow and the mortgage is paid off.
So first up, make sure the primary income earner is covered. If this income disappeared then you want to make sure the ongoing family needs are covered. Insurance could cover that additional cost. So if any secondary income is relied on to cover expenses either through income or an unpaid contribution then that person should also have an insurance policy.
Do you need to get life insurance for your children? Otherwise, there is no reason for children to be insured as they do not contribute to the family income.
Having life insurance not only gives you peace of mind knowing your family will be taken care of after you or your spouse has gone, it may well be one of the best financial decisions your family could make.
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