That’s a great question and a question that many people neglect to carefully consider. In a nutshell, you need life insurance if anyone at all that depends on you would be put in a bad financial situation if you were to die. It wouldn’t be too far off to say that 99.9% of all married breadwinners need life insurance and 99.9% of everyone with children still living at home (or at college) need life insurance. If you have people that economically depend on your for any reason or circumstance, it would be a good choice to get life insurance. This is the short answer but lets go into a little more detail.
The Definition Of Life Insurance
Life insurance is defined as a contract between a policy owner and insurer, in which the insurer agrees to pay a sum of money to the policy beneficiary in the case that the insured dies. In return policy holder (owner of the policy) should pay premiums at regular intervals (typically monthly, quarterly, or annually).
5 Simple Questions to Ask That Will Help Determine If You Need Life Insurance
The best thing to do in case you are undecided on whether to buy life insurance or not is to ask yourself these 5 simple questions:
- If I died today, what financial position would I leave my loved ones in?
- Will my loved ones be able to pay for my funeral, medical bills, lawyer’s fees and taxes?
- Will my loved ones have enough money for rent or mortgage, healthcare costs and food?
- Will my children have enough money to attend a college or university?
- Will my loved ones be able to pay off any outstanding family debt?
If any of these questions give you pause then now may be the time to seriously consider shopping around for a life insurance policy that will protect your family’s financial future.
Categories of People That May Need Life Insurance
Here are some typical categories of people that may consider be in the process of considering if they should purchase a life insurance policy.
Married: If you are married then you know that most families depend on two incomes in order to run successfully. In case of your accidental death will your family be able to keep going on without any restraints? Will they be able to reach their future goals without you?
Single Parent: If you are a single parent then you do everything around the house. You work, cook, clean, help your kids with homework, wash the dishes, provide for the household. Staggering statistics show that about 40% of American single parents don’t have life insurance at all! And those that do say they need more because it won’t cover their expenses in case of their death! If you fall in this category it is imperative for you to have enough life insurance to take care of your children in case of your death.
Work at Home Parent: If you are a work at home parent you are still making a contribution to the household. Because of you, your spouse doesn’t have to invest in a cook, a maid, child-care, transportation and more. Those things all would be gone in case of your death. Will your spouse still be able to manage without you?
Empty Nesters: Many people that don’t have anything else to pay for and whose kids are out of college and in the work force, don’t see the need of having life insurance. Sure, you have no other expenses at this time in case of your death, but that doesn’t mean that your spouse won’t have any need for money in the later future. In today’s society where your spouse can outlive you by ten or more years it is necessary to have life insurance, just in case your social security and your savings are not sufficient for what lies ahead.
Retired: If you are retired then the need for life insurance isn’t as great as that of other people. Nevertheless, life insurance can help pay for your funeral arrangements and any taxes that your estate owes upon death. Not to mention that your heirs would be able to receive a legacy and provide for many of their financial needs.
Single: Most single people don’t see the need of having life insurance and who can blame them? They have their whole life ahead of them, no financial responsibility and no dependents. However, there are instances in which a single person does need to have life insurance. Those people who provide financial support to aging parents or siblings and those that have debt that they wouldn’t want to see passed on to their parents. If you find yourself in any of these situations it is important for you to acquire life insurance so you don’t leave burdens to your family in case of a premature death.
Make Sure That You Have Enough Life Insurance Coverage
Although many people need life insurance, statistics show that only 61% of adult Americans have life insurance, a decline of 9% when compared to 1984. Also, the people that DO have life insurance don’t have enough to truly help their loved ones in case of an unexpected death. Many people mistakenly assume that the very small amount of group term life insurance coverage that they have through their employer is sufficent life insurance coverage (often only $50,000 or less). With so many things that can go wrong it is important to protect the future of the people you love.
Compare Free Life Insurance Quotes Now!
If you don’t have life insurance and you see from the scenarios above that you should have it then shop around. Use our free tool at the top of the page to compare life insurance quotes from many different life insurance companies side by side. Get started with a free life insurance quote comparison now!