subject: Why Life Insurance Is Important For Established Families [print this page] Obtaining life insurance coverage is an important part of securing the financial future of your family. Even families with comfortable lifestyles or little debt could be adversely affected by a crisis. In the event of your death, funeral costs, unpaid debts, and end of life medical bills could burden your family. Having the right type and amount of life insurance coverage can prevent your family from needing to liquidate your assets to pay bills. The availability of insurance quotes online makes the process of getting the right coverage much easier.
Keeping Coverage Current
Many couples obtain life insurance policies when they marry, or when their first child comes along. However, you must update your policy in the event that you add more children to your family. As a general rule, you insurance needs increase along with your standard of living, since the goal is for your family to maintain that standard in the event of your death.
Free life insurance quotes should also be obtained in the event of a drop in interest rates. You should plan for your family to invest the death benefit that your policy pays out, and live off the interest earned on that money. If interest rates drop significantly, more coverage may be necessary to offset the negative effect this will have on the potential earnings from your policy death benefit.
With the busy lives most families lead today, insurance needs can be forgotten or neglected. A good rule of thumb is to review insurance policies every eighteen months, updating them as necessary.
Types of Coverage: Term vs. Whole Life
In addition to choosing the right level of coverage for your family, you will also have to decide which type of insurance to purchase. There are two types of life insurance: term, and whole life. Free life insurance quotes for both types can be found online with just a bit of searching.
Term life insurance is temporary coverage, available for a set amount of time. This type of coverage is more easily obtained, and less expensive than whole life. Families who are younger, or have less available money to spend on coverage, can consider a term life policy. However, it should be noted these policies are subject to cancellation.
Whole life insurance, on the other hand, is permanent coverage. While it is more costly to obtain, it will not be cancelled as long as premiums are paid. Also, the money that families pay into a whole life policy builds cash value. These funds can be borrowed against, and used to cover expenses like college tuition.
by: Shaun Greer
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