Insurance for Life

By Elayza Gonzalez

If life has taught us anything, it is that it can be uncontrollable and unpredictable. That is why it is important that as parents you prepare for any and every possible outcome, even an untimely death. One way to do that is through a life insurance policy.

Life insurance can be more for your loved ones than it is for yourself

Larry Hartfield, who has been the owner of Hartfield Insurance Group, Inc. for 10 years, said the main purpose of life insurance is to replace income and cover debts in the event of the insured’s death. “Simply put, you need life insurance if someone else is depending on your income or if there are obligations that you want fulfilled,” he said. In the event of a death, life insurance helps provide the necessary funds to the surviving family members, and it is also a way to ensure that their current economic lifestyles do not change too much. Although a death in the family is a life-changing moment, and there is no way to really prepare for it emotionally, life insurance at least helps you prepare for it financially.

The benefits of life insurance can last a lifetime

“One of the biggest benefits of having life insurance is the peace of mind it provides,” said Hartfield. A life insurance policy provides an income to cover everyday expenses, plus it also helps with other outstanding obligations, including mortgages, credit cards debts and car loans. Through life insurance you can create a more solid financial future for your children (or grandchildren), and one of the more important benefits of life insurance is that the proceeds go to the beneficiary income tax-free.

There are also ways to benefit from life insurance while you are still living. As part of their online Finance Fundamentals Series, Northwestern Mutual explained how the value of life insurance goes beyond risk protection. There are two types of life insurance policies: term and permanent. These policies are best known for their “death benefit,” but they also offer other benefits as well. Term policies offer protection for a specific period of time and only pay a benefit if you die during that time period. However, permanent policies provide protection throughout your lifetime and can also include “living benefits,” like building equity and tax advantages.

Don’t wait until it’s too late

Hartfield said the best time to purchase a life insurance policy is when you are younger and healthier, as that is the time when the rates are the lowest. “From my experience, many people procrastinate until an important life event pushes them to buy it,” he said. But, by then it might be too late. The cost of life insurance increases with age, also as one ages the chance of developing a medical condition increases. There are a variety of life insurance options for different budgets, so take advantage of them while you are still young and then modify the policy in the future as your needs evolve and your budget allows.

Think positively, but prepare for the unthinkable

Getting a life insurance policy does not necessarily have to be at the top of your list of priorities. However, terrible things, like the death of a child, can happen. “If the unthinkable were to happen, the thought of returning to work would probably be the furthest thing from your mind,” said Hartfield. Your child’s life insurance policy could offset the loss of income you would experience from taking time away from work or it can help cover the expenses of seeking family help and grief counseling. Hartfield said funds could also be used to establish a charity in the child’s name, so their life can be memorialized for many years to come.

Life insurance can also be used to guarantee a child’s future insurability, meaning if your child develops an illness or becomes seriously injured later in life, he will have the opportunity to increase his life insurance in the future — no matter his health status.

Although life insurance might be uncomfortable to talk about, having a policy means having more time to enjoy life with your loved ones and less time worrying about the unknown. Aside from life insurance having countless benefits during life and after death, the greatest benefit is knowing you can live life to the fullest while knowing your family will always be protected — and that is priceless.