In today’s economic climate, where families struggle to make ends meet, losing one wage earner can cause financial chaos. A life insurance policy can protect a family from financial upheaval by providing funds to replace the income of a lost family member. Life insurance can also fund funeral expenses, children’s education and pay off or reduce existing mortgage debt. However, not all life insurance policies provide adequate financial protection. If you carry group life insurance through your employer, you are not in control of your coverage. Many employers have reduced the life insurance benefits they provide in an effort to cut costs; your life insurance benefit could be reduced or cancelled without your knowledge and expose your family to financial risk. If you change employers, your benefit most likely ceases.
To guarantee your family’s financial future, purchase a personal life insurance policy you control that is tailored to meet your needs. Term life insurance is one type of policy that is surprisingly affordable, with a rate/premium that is locked in for the life of the policy (typically 15, 20 or 30 years). Another type of policy, permanent life insurance, can include a rate and benefit guaranteed for life. People with serious health issues may face surcharges in order to obtain a life insurance benefit. However, if they already have term life insurance in place, they may convert their term coverage to permanent life protection. They retain their original rating classification (preferred) and no additional medical underwriting is required. They “guarantee” their future insurability, which affords them critical flexibility should they ever need it.
Term life and permanent life insurance policies are two options you can use to protect your family’s financial future. Choose the life insurance policy that will best fit your family’s needs. Remember, life insurance policies are designed to alleviate financial stress and help your family heal from the biggest burden of all---emotional loss at an uncertain time in the future.