WHY LIFE INSURANCE
We always want the best for our family but life is full of uncertainties and There is a big ‘IF’ in ‘LIFE’ itself. An essential part of financial planning is to create provisions for your family and loved ones following your death. Life insurance can ensure financial security to those who mean the most to you, such as your spouse, children and dependent parents.
PERILS OF LIFE –HOW LIFE INSURANCE CAN HELP
Peril 1: Dying too soon
While the statistical probability of passing away at an earlier age is low, the financial consequences of not planning for that possibility can be high. The younger the family, the more protection they generally need — small children who require care, years of income that is forgone, and typically these families have high debt made up of student loans and mortgages. Life insurance financially protects the family and your loved ones.
Peril 2: Living too long
Due to medical advances, we are living longer than ever. That means planning for a long retirement. In the past, planning for a 15-year retirement was common. Now it can be 20 years, 30—or even longer. You may have a greater number of years in retirement than the actual number of years you may have worked. That means, the need to save is critical. A life insurance policy can provide cash value that can be used to supplement your retirement income.
Peril 3: Becoming disabled
Statistics tell us that in our working years there is a higher probability of becoming disabled than dying. How does this relate to life insurance? Many life insurance policies allow you to add a disability waiver to cover certain fees and expenses in the event of a total disability. You can also add a waiver of premium for disability that can help to keep the policy in force and continue to provide the peace of mind .
Peril 4: Need long-term care
You are also faced with concerns over long-term care costs. You may need home modifications or develop a debilitating disease. These costs are not covered by regular health insurance or Medicare. Nursing home stays or home health care costs can have a detrimental effect on your portfolio. What if you were forced to access your retirement funds to pay for long-term care needs ? Would you still have what you needed for retirement living? Instead, a life insurance policy with a long-term care rider can provide payments to help cover long- term care costs.
WHAT IS YOUR HUMAN LIFE VALUE—WHY DOES IT MATTER?
You wouldn’t think of insuring half of your car, home or other important personal property, would you? Yet when people are looking to purchase life insurance, a common perception is that only some modest multiple of your income in terms of coverage is actually “needed.” However, this often falls short of what your actual earning potential would be over your lifetime – your so-called “human life value.”
In layman’s terms, your full human life value must take into account the financial sum of all you could have earned or produced in your lifetime.
In life insurance parlance, “Human Life Value” or HLV, represents the amount that ensures a family’s standard of living does not get affected if the one who earns for the family dies or is unable to continue earning.
You may think that the insurance policies you already have may be sufficient, but it may not match with your current human life value. So Your family’s financial security deserves a longer-term strategy.