Life insurance can offer multiple advantages to family members of a policy holder. These reasons to buy life insurance policy are unbeatable.
Life insurance is also known as life assurance or final expense insurance. It is a legal contract between the policy holder & insurer to pay a sum of money to the named or designated beneficiary in exchange for premiums.
Its benefits are usually provided after the death of insured person, although specific exclusions are found to occur. It is one of the best & wonderful policies needed to protect your family, dependents, business & legacy.
According to LIMRA’s 2015 Insurance Barometer study, around 57% of all people in United States were covered by some form of life insurance in 2014.
Here are 10 smart reasons to purchase life assurance policy:
(1) Supplementing Employer’s Group Life Insurance
It is one of the most common reasons to buy life insurance policy. Several employers provide group life insurance to cover their employees under a single contract.
Generally, an adequate life assurance policy should provide 7 to 10 times the insured person’s annual salary. But, you should also consider various factors such as client’s income, assets, liabilities & future plans.
However, the work coverage under employer-provided life assurance policy is usually not adequate. It is because most of the employers are providing coverage equivalent to 1 to 2 times their annual salaries.
This inadequate coverage might be enough for someone who is single without any dependents. But, if you have mortgage debts, young children as well as a nonworking spouse then you will need additional coverage for your needs.
According to the National Association of Personal Financial Advisors (NAPFA), a healthy 50-year-old male could save around 80% on life insurance premiums in the first year alone just by switching from a group-life insurance policy to an individual policy.
Thus, you should never hesitate to switch from group-life insurance to individual policy.
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