Life insurance is one of the most important insurance solutions that you can implement to guarantee your loved ones’ financial well-being and future in case of a breadwinner’ss premature death.
In the event of a serious tragedy that could claim the life of a breadwinner, life insurance proceeds can help the surviving loved ones:
- pay off outstanding debts, including credit cards, lines of credit, car loans, and mortgages.
- help pay survivors’ ongoing bills and living expenses (through income replacement).
- pay for funeral expenses.
- pay for final taxes.
- finance the continuation of the family business.
- finance your children’s future education needs.
- protect the retirement plans of the surviving spouse.
- and even empower you to leave a legacy to your spouse and children.
Fact is, no one really wants to talk about life insurance since most people dread contemplating the possibilities of premature death but if someone depends on you financially, life insurance planning is simply a topic you can’t avoid.
Implementing a life insurance policy doesn’t mean that you’re planning for your death as some people might think, it also doesn’t have to be too costly that you can’t afford to maintain.
Your Winnipeg life insurance conversation doesn’t have to be grim or morbid for your future is bright and there’s a lot to live for.
Like any other insurance solution (home insurance, car insurance), life insurance protects your loved ones financially not because you’re expecting something to happen but because it may happen.
Think of it this way…
You implement home insurance when you buy a house, not because you’re expecting your house to burn but because you want to protect yourself from your mortgage payments should the unexpected happen.
Of course, I’m in no way comparing a person’s life value to that of a house because a person’s life is unquestionably way too valuable than the most expensive of all houses but as homeowners, we are obliged to get home insurance to avoid finding ourselves in a situation where we still have a mortgage to pay when the house was already gone.
Though not required, it is our obligation to ourselves and our families to implement the necessary life insurance protection to protect our loved ones from the unexpected and avoid a situation when the family income is cut in half while the monthly dues for bills, debt servicing, and other costs of living remain the same.
Simply put, implementing life insurance protection is just a matter of laying in place the right financial safety net that your family needs even when you think that they will never need it!
Life Insurance Options
Life insurance planning depends entirely on what stage of your life you are in right now while considering your future goals and aspirations.
- You may be at a stage where you’re just starting out in your career with a young family and a high mortgage obligation.
- You may be at a more established point in your career and family life and with assets or business that you want to protect.
- or you may be at a point where you’re looking to secure your assets or legacy, ready to be passed on to the next generation.
Whatever stage in your life you are in right now, a well-planned Winnipeg life insurance solution should provide you with the peace of mind you need knowing that all your current assets and obligations are well protected.
Your specific life insurance needs will, of course, have to depend on your personal circumstance and as opposed to what you may have been advised before, there are no one-size-fits-all insurance solutions for everyone as each individual and family have different financial situations and future goals.
For most people, the most basic asset that needs protecting is their ability to work at a job or business to provide income for themselves and their families. Once this ability is stripped off a person, the income that he or she brings in for the family stops and there are three general life scenarios that can affect our ability to work for income and they are the occurrence of disability, critical illness, or death.
As I’ve mentioned in one of my articles, the death of a breadwinner has the single, biggest negative impact that will change a family’s life forever. This in itself is a reason enough why you have to implement the proper life insurance protection especially when you have a young family.
Of course, you may be at a stage in your life where you need more financial protection than simply protecting your ability to work for income, you may have more assets or obligations to protect and we have to consider all those when planning your life insurance protection.
On average, most people’s obligations are classified into permanent and temporary; the good news is, most of your financial protection needs are temporary that only needs to be in place in the next ten, twenty years or thirty years depending on your age and/or circumstances.
Needs that you can not put an end date to are considered permanent needs, our final expenses (funeral and taxes at death) for example are considered and will always be classified as permanent needs due to the fact that we don’t know when we are going to pass away.
Other financial needs at death that are considered permanent are legacies, charitable donations, and property disposition taxes.
To address these variable financial protection needs, there are generally two types of life insurances and they are Permanent Life Insurance and Term Life Insurance.
Three Types of Permanent Insurance
Common Term Life Insurance Classifications
- 10 Year Term Life Insurance
- 20 Year Term Life Insurance
- 30 Year Term or Term to 65 Life Insurance
- 40-Year Term Life Insurance
Well-Planned insurance protection may come as a combination of permanent life and term life insurance in one policy. If budget is your concern, you can always start a term life insurance policy that covers all your financial obligations with a provision for policy conversion at a later time.
If on the other hand, you prefer an all permanent financial protection solution, Whole Life and Universal Life insurances are two options you may consider.
Regardless of whatever types of life insurance should you decide to implement, the more important consideration is getting the proper amount of financial protection in place that suits your family’s needs.
Proper life insurance planning takes more than just a quick online term life insurance quote.
An expert life insurance professional can help you make a well-informed insurance planning decision.
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