3 Reasons - Buying Life Insurance

There are three important reasons for buying life insurance.

Number one is to take care of dependents. Sometimes the family of the deceased is left with huge debt or financial obligations, not knowing where the money will come from to pay them off. Many well-off families have been forced to sell properties in order to raise the funds needed for such obligations. When a person buys life insurance, this hassle will not be there. The insurance policy will make sure that the proceeds from the policy will have been used for this purpose.

Death means the end of everything – no more income from work or business to pay for the usual daily obligations such as utility bills, food expenses, transportation allowance, etc. With a life insurance policy, one is assured of financial pay-out from the insurance provider. The pay-out could be used to take care of those bills just like when there is a steady source of funds. When one buys a life insurance policy with coverage that is 10-15 times his or her annual income, family will no longer worry about the recurring bills and financial obligations left by the departed loved one. Thinking about the welfare of loved ones will be reason enough to buy life insurance.

Number two is estate planning. For some people, life insurance can serve other purposes than just leaving money for the beneficiaries. If an insured owns estates or properties, chances are the estate taxes to be collected from such properties are likely to be huge. Some insurance providers offer this inclusion or condition to life insurance – estate planning.

A life insurance policy will be used to pay for the estate taxes in advance, so that heavier or stiffer taxes imposed on the estates or properties will be avoided. A plus factor of buying this life insurance is that an insurance settlement amount will not be taxed at all at the maturity rate. This is the best way to transfer properties or estates to beneficiaries and loved ones without the unnecessary hassles. More details on the benefits of this life insurance may be requested online. The important thing is to make sure that when you buy life insurance, corresponding benefits are included for specific purpose and intent.

Number three is paying for burial expenses, which are very expensive. Families are having to spend thousands of dollars for funeral expenses and a memorial service. Many families cannot afford this, and cannot send off a loved one in the way they would like. Purchasing life insurance would cover these expenses.