Life insurance is a contract between an insurance policy holder and an insurer. The insurer promises to pay a designated beneficiary a sum of money (the benefit) in exchange for a premium upon the death of an insured person. The policy holder pays a premium, either regularly or as one lump sum.
Listed below are the reasons for buying a life insurance.
- Life insurance is a tool that protects your spouse and children from the potential devastating financial losses that can result if you die prematurely.
- Life insurance gives survivors a chance to adjust over time rather than having to move to a downsized house or find a a new job immediately. The life insurance gives your family choices by providing the benefits to help pay off debts, to help meet housing payments and ongoing living expenses, funeral and burial expenses, etc.
- Life insurance policy delivers a specified sum of money at the time of need upon your death.
- Life insurance is for protection and providing financial relief for those who must carry on without you.
Therefore, planning ahead and buy life insurance guarantees that you can continue to protect and provide for the people you love after you are gone.