When Is Life Insurance Necessary? Blogging Away Debt

by Susan Paige

Life insurance. It really is one of those topics that no one wants to talk about. It’s not pleasant to think about the circumstances that involve life insurance policies.

However, there are many instances when having these tough conversations is absolutely beneficial. Everyone can rest easier when these tasks are done.

Research shows that 57% of adults in the United States have a life insurance policy. But do you need one?

Read on as we answer the question, “When is life insurance necessary?”

You Have Dependents

The most obvious and most common scenario of a need for life insurance is when there are dependents involved. That could mean a spouse, children, disabled adult family member, or parents.

If someone depends on your income to live, you should have a life insurance policy.

When the life insurance policy is cashed out, those defendants can use that money to pay for the funeral and other expenses. They can also use it to live on for a designated period of time. All of these needs will be discussed with your broker when you take out a policy.

You Own a Business

Even if you don’t have any direct dependents, you may still need a life insurance policy if you own a business.

Whether you are the sole owner of the business or have a partner, there are people who depend on you for their livelihood. In that case, having a life insurance policy can aid in the continuation of your company. Or, it can at least help those to find footing and move forward.

You Want to Help Fund Your Funeral

Okay, you don’t have any dependents and you don’t own a business. Should you have life insurance?

The answer is still “yes” if you want to help pay for your funeral.

A funeral is not a cheap event and could set those around you back around $11,000. A life insurance policy is an easy way to help carry some of that (or all) of that cost so your loved ones don’t have to.

You Are Young and Healthy

Many say that the best time to get a life insurance policy is when you are young and healthy. At first glance, that seems pretty counterintuitive. But that actually makes perfect sense.

A common practice is for life insurance policies to be dependent or affected by medical histories. So a young, healthy person would potentially get a lower rate than an older person with some chronic illnesses.

But you might be thinking, “How can I qualify?” The process is actually pretty simple most of the time and can be handled with an insurance broker.

Save yourself some money and get a policy now!