What is Family Life Insurance?
Life insurance for the whole family can come in many different forms.
It can include term life insurance coverage, whole life insurance,
universal life insurance or a combination of term life and permanent
policies. In essence, family life insurance coverage can easily be
tailored to your family’s unique needs.
But before you invest in family life insurance, it helps to know how
these policies work and why you should make sure every member
of your family has proper protection. This guide aims to explain the
core components of family life insurance, how these policies normally
take shape and why you should secure life insurance sooner rather
than later.
Family life insurance explained
Family life insurance is a term used to describe a life insurance policy
that includes coverage for every member of your family. While the
details of these policies vary, family life insurance commonly includes
whole life insurance coverage for the breadwinner of the family and
term life insurance coverage for his or her spouse and dependents.
With that being said, family life insurance is customizable and can be
formatted in any way that suits your needs. For example, a family life
insurance policy could include term life insurance for both parents and
their kids, or everyone could have some level of permanent coverage.
What is term life insurance?
Family life insurance may also be convertible. For example, life
insurance coverage for children often comes in the form of a term
policy until they reach adulthood. From there, their policy could be
converted to permanent coverage that they can continue to maintain
on their own.
Regardless of how you fashion your coverage, the point of family life
insurance is to make sure each family member has enough life
insurance to meet their needs at every stage of their lives.
For instance, if the breadwinner of the family passes away before their
time, you’ll want to have enough life insurance to replace their income,
take care of family debts and pay for their final expenses. Meanwhile,
it’s also important to have life insurance for the supporting spouse
even if they don’t work, since families can benefit from coverage that
pays for final expenses, childcare and other types of support.
Additional expenses you can cover with family life insurance include…
*Daily bills like groceries and utility bills
*Mortgage or rent payments
*Car payments
*Credit card bills and other debts
*Medical expenses or long-term care
*College tuition and fees
When choosing a family life insurance policy, you’ll need to consider
what varying expenses are likely to arise based on which member of
the family were to unexpectedly pass, then fashion your coverage
around protecting your family in case an unfortunate event occurs.
Joint life insurance policies for spouses
A joint life insurance policy can be a good choice for spouses without
children.
Even for families who don’t have children, buying a life insurance policy
with a spouse can make sense. A joint life insurance policy can help
ensure either spouse is able to continue their current lifestyle if their
partner were to pass away. It can also help to pay off debts, provide
funds for business transition planning and cover final expenses.
How much life insurance do you need?
Like other types of family life insurance, a joint life insurance policy can
be tailored to meet your needs and goals. However, joint life insurance
usually comes in the form of permanent life insurance that’s meant to
provide a death benefit until the day you die.
Many couples also add specific riders to their joint life insurance policy.
For example, you could have an accelerated death benefit rider that
allows you to access the death benefit early if your spouse is diagnosed
with a terminal illness like cancer or advanced heart disease. From there,
the funds could be used to pay for long-term care, medical expenses or
other bills that arise from having a terminally ill partner.
Family life insurance for children
No one wants to even think about the death of a child, but life insurance
for children isn’t necessarily only about protecting your child at an early
age. Yes, it can help you cover some expenses if the unthinkable happens,
but life insurance for children can also be helpful in ensuring that your
child has a policy in place as they grow into adulthood.
Convertible insurance policies can guarantee that your children are
covered even if they wind up with health conditions that might prevent
them from qualifying for life insurance on their own later in life. And while
you can purchase life insurance for children separately, policies for
children can be bundled and included within a family life insurance plan.
Life insurance for your parents and grandparents
Another component of family life insurance is coverage for parents and
grandparents. While older family members may be limited in the types
and amounts of life insurance they can qualify for, family life insurance
can include something as simple as final expense insurance with a death
benefit that’s small but adequate to pay for funeral expenses and other
final bills.
Do you need final expense life insurance?
When you’re considering your family’s life insurance situation, make sure
you also evaluate the current policies on your parents and grandparents,
and ensure they have some sort of coverage in place. If they don’t have
adequate insurance, you should consider helping them sign up for a term
life insurance policy, permanent life insurance coverage or final expense
insurance.
With final expense insurance in particular, elderly family members may be
able to secure coverage without having to undergo a medical exam. They
likely won’t be able to qualify for a policy with a large benefit, but you can
potentially get them a policy that’s appropriate for their needs at a
reasonable cost.
Should you get family life insurance?
Family life insurance can protect your family if anything happens to any
member of your household.
Purchasing family life insurance may sound stressful, but it certainly
doesn’t have to be. The best life insurance companies can help you figure
out how much coverage you need for each of your individual family
members as well as the types of life insurance that will best suit your
family’s needs.
Finally, since you may be able to qualify for lower insurance rates or more
coverage when you’re young, we suggest comparing life insurance rates
as soon as possible. Not only does life insurance always get more
expensive as you get older, but if you wait to secure coverage for your
family and tragedy strikes, you could easily regret it.
Author: Holly
Johnson
Source:
© 2022 Cable News Network
Retrieved from: cnn.com
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www.haydenchilds.net
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