Buying a life insurance policy is something responsible adults do to provide for their families and loved ones should the worst happen. But if you’re young and single with few responsibilities, you may think that you don’t need to take out coverage. Why would you when you’re young, healthy, and you have no dependents? The truth is that everyone should have some form of cover as the future is unpredictable and having a financial security blanket in difficult times can make all the difference to you and your family. Having a policy is even more important if you fall into one of the following five categories.
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About to Start a Family
The imminent arrival of a baby is a great reason to get life insurance. You want the peace of mind that your child will be looked after financially should the worst happen. But don’t wait until the birth of your child before buying a policy. Having it in place before the baby arrives will ensure that you don’t forget about it when you’re busy with the new arrival.
Supporting Your Aging Parents
You might be acting as a caregiver for your parents or older family members or supporting them financially. If they rely on your income, you need to make sure they will continue to receive financial help and the support they need if you’re not around. When your parents pass and the coverage has served its purpose, rather than let the policy lapse, you can sell your term life insurance policy to a third party who will offer you a life or viatical settlement. The settlement will be less than the net death benefit due but more than its surrender value. It’s a win-win as you will get to cash out should the term finish and you no longer need cover.
Have Private Student Loan Debt
Many parents co-sign private student loans for their children to help with the financial burden of further education. Taking out a policy can make sure that your parents won’t be left with the debt should you pass away. Even if your parents didn’t co-sign your loan agreements, you don’t want to leave that debt behind, especially when you’re married and your spouse is dependent on you. While federal student loans are discharged when you pass away, discharging private loans is at the discretion of the lender.
Work for Yourself or Family-Owned Business
If you own your own business or are a key member of a family enterprise, your death or disability will have a massive impact on its operation. Taking out a business-owned life policy combined with disability insurance is a wise decision and naming the business as the beneficiary will ensure that it has the finances to continue in the event of your death. Taking out a business loan will often mean taking out life insurance to pay off the loan should you die while the loan is still in play, and many loan companies and banks insist on it.
High-Risk Profession
If you work in a high-risk or dangerous profession or environment, the odds of you getting injured at work are greater than if you are a desk-bound employee. While your life or health may be covered by your employer with a death-in-service benefit, if you leave your position, you’ll lose the coverage. Having private life insurance in place will give you greater peace of mind that you have adequate protection for your dependents should there be a fatal accident at work. You may also want to consider taking out disability insurance.
