Do I Need Life Insurance?

If you have people who depend on your contributions to the household, both financial and otherwise, you probably need life insurance. It’s especially important for breadwinners, but also for stay-at-home parents who make valuable contributions that would be difficult and expensive to replace. Life insurance can also help you create an inheritance for the next generation, and provide living benefits that provide financial help if you become disabled or terminally ill.

Why Do I Need Life Insurance?

If you have a spouse, kids, siblings, or parents who depend on you financially, you need life insurance. Life insurance protects those loved ones if anything happens to you. When you buy a policy, you’re essentially buying the insurance company’s promise to pay the people you care about most when you pass away.

You get to choose who should get paid and how much of the total death benefit they should get paid. Think of that money as income replacement – it replaces the financial contributions you would have made for them. That money can buy essentials, pay rent, and put food on the table. It can also send the kids to college or provide for aging parents.

If you have responsibilities for people in your life, life insurance protects those and ensures you fulfill those responsibilities even if you pass away. That’s why you should think about buying life insurance.

Do I Need Life Insurance if I Have No Dependents?

Good question! If you don’t have anyone depending on you financially, life insurance coverage can still be useful. All of the situations below could apply to you if you’re single, or if your spouse has already provided for the kids with a policy of their own.

• Do you have debt from credit cards or a student loan that would fall on a loved one if you died? If so, you can name that person as your beneficiary so they have the cash to pay your debt if you pass away.
• Do you want to leave a legacy to a favorite charity or your alma mater? You don’t have to name a person as your beneficiary. You can also name a school or charitable organization, which makes life insurance a great way to leave a little something to a worthwhile cause in your name.
• Do you want to leave an inheritance for a loved one? Even if you have no debt and no kids, you may still want to leave a legacy to someone you love: a grandchild, a niece, a nephew, a sibling, etc. Is there a dream they’ve always wanted to chase but haven’t achieved yet? Life insurance can help them do that, as a final gift from you to them.

When Should I Get Life Insurance?

Since the cost of life insurance is based on your age, the easy answer is: right now! You’ll never be younger than you are now, so life insurance won’t be any cheaper next month or next year.

Of course, age isn’t the only factor that determines what your coverage costs. But it’s a huge component, so you definitely want to take that into consideration. Here’s what else insurers consider:

• Your health. Insurers need to have a rough idea if or when they’ll need to pay out on your behalf. And that means estimating how long you’re likely to live. To figure that out, they take a look at your age, height, weight, health history, and any medications you’re on, as well as any chronic illnesses you may have.
• Your family health history. Because many diseases are hereditary, they’ll ask you whether anyone in your immediate family has died of diseases like cancer, heart disease, stroke, or diabetes.
• Your lifestyle. Your hobbies help the insurer decide how big a risk you are to insure. Hobbies like hang gliding, base jumping, rock climbing, or car racing make you a bigger risk than, say, knitting or walking your dog. The insurer will also want to know if you smoke (tobacco or marijuana) to get a fuller picture of your lifestyle.
• Your job. Like your hobbies, your job could present another risk factor. Are you a pilot? A deep-sea diver? Risky jobs mean you’ll pay more for life insurance.

As the seconds tick by, you’re getting older – and your coverage may be getting more expensive. The best way to see where you stand is to get a free quote right here:

What Type of Life Insurance Do I Need?

That depends on your budget and your financial needs.

• On a tight budget? Term life insurance is your best option, hands-down. It’s affordable and it’s easy to get. You choose the length of time you want to be covered, up to 40 years. If you pass away within that term, your beneficiaries get paid. It’s as simple and straightforward as life insurance can be. I recommend term life for clients who have time-specific financial obligations, like raising kids to age 18 or paying off a mortgage.
• Have a bigger budget and don’t want coverage that expires? Permanent life insurance is probably the best option for you. Unlike term coverage, it won’t expire. As long as your policy is current and paid up, your beneficiaries will get paid no matter when you pass away. Because of the guaranteed payout, this type of coverage costs more than a term policy. But if you’re the type who prefers something safe and guaranteed, the extra cost may be worth it.
• Want options that provide supplemental retirement income or investment options? There are types of permanent policies that offer cash value – think of this as a savings component of your policy. You can withdraw from or take loans against this cash later, after it grows with interest over time. Some policies give you the option to invest your cash value so it can grow even faster than the usual flat rate of interest. Examples include universal life insurance and variable life insurance.

Which type is right for you? The easiest way to get a straight answer is to give me a call. We can talk about what you’d like to cover and I can recommend an amount that would work to meet those needs.

What to Consider When Buying Life Insurance

Buying life insurance isn’t all about the cost – sometimes it’s about the time and the convenience. If buying a policy has been on your checklist for awhile but it’s always seemed too complicated or time-consuming, there’s good news.

• Can I get life insurance online? Yes. Some insurers have a 100% online process, which means you can complete your purchase on your smartphone. Every life insurance company offers different policies and buying options, so let me help you find that one that fits your busy schedule.
• Do I need a medical exam to get life insurance? No. Although it’s more affordable to take the free life insurance medical exam, you can opt for what’s called a non-med policy instead. There’s no exam – instead, all you do is answer a questionnaire about your health and lifestyle. Tell the whole truth and nothing but the truth, and you’re good to go. This is a great option for people who are too busy, who don’t want face-to-face contact, or who don’t like needles and would prefer to skip the blood draw that’s part of the traditional medical exam.

If you’re interested in online-only or non-med policies, give me a call! I can get you quotes and details for the insurers, products and services that fit your needs. Let’s get you covered!