Understanding the Living Benefits of Life Insurance

So, you want to understand the concept of life insurance and the living benefits it affords?

I applaud your interest, as your decision to read this article will contribute to one of the best decisions you will make in your life. 

Whether you already have sufficient life insurance coverage, just a little or none at all, you're in good hands...provided you will apply the knowledge being shared with you.

For starters, let us go to the basics. Life insurance is a contractual agreement made between the insured person (s) and the insurer who will be responsible for paying out the sum bought to the beneficiaries in the case of the insured's death. But before you start swaying your mind from that previous sentence let us assess the importance of this.

Some persons are of the view that life insurance is death business, primarily because of this one factor. While this is not a bad thing, I will help you understand the living benefits as well, just so you will have a balanced outlook. 

Back to the infamous view of life insurance being death business. While it is uncomfortable and in some cases insensitive to talk about death, more and more families are starting to get it right. 

Imagine a family where there are parents and children. The parents owe a substantive amount of money in loans. They have little to no savings for emergencies nor for the education of their children. Imagine now, that one of the parents die. Yes, these things happen and the sooner you begin to think maturely about these scenarios, the sooner you will be able to put mature decisions in place as well. 

Right, so one of the parents die. This now means that there is a strain on the other in terms of final expenses i.e. funeral costs. This alone sometimes send families into more debt and a more distraught frame of mind. 

If the deceased person has loans, the family will be targeted for the clearing of such loans which may include taking possession of assets in the home. What if they had a mortgage together? One now has the burden of paying solely and risk having the home foreclosed. The children of the union may now have to take loans for education or forego higher education all together. Or maybe, the other parent can double up to save that from happening.

All in in, a stressful situation to be in. One that could have been alleviated if the deceased had life insurance. Life insurance provides peace of mind. 

One knows, that should their loved ones outlive them, they can be financially secured, especially if it is the main breadwinner that passes. Some of the financial stresses will be alleviated, even though the mourning for a loved one continues.

Who wouldn't want this for their loved ones? I don't know about you, but I sure wouldn't want my children nor parents worrying about paying off loans I owe, spending their last dollar on funeral expenses, risk not having a home, their medication or education while still dealing with the financial woes a top of their emotional worry.

When you you love your loved ones, paying your life insurance premiums monthly, semi-annually or annually shouldn't seem like death to you. It's an expression of commitment and love.

Enough about the sad love story. Let us assess the living benefits of life insurance. You heard right. Your life insurance policy has a plethora of benefits you can access while you are still having coffee and visiting friends.

First, answer this question, do you want to have financial freedom?

If you don't already, then having your life insurance is a start! Consider a pyramid. At the base, life insurance is your foundation while the top signifies the achievement of financial freedom. To get to the top, there are a few steps up, however, your base/foundation/insurance must be strong to avoid you toppling over.

 In a situation where you do not have insurance (life, health, accident, dismemberment etc.) you will be tempted to use your savings, money accrued to pay off debt, your investments etc. to take care of what your insurance would have taken care of. That leads you to start all over again on your road to financial freedom and you will start over many times more, if you do not get it right. Just as how savings should be separate, so too should your emergency fund, debt management portfolio, investments and your insurances. 

The next time you imagine being financially free, remember that your life insurance as well health insurance too, help to make up that foundation.

Since you may not yet be liquid enough to purchase your dream home cash or build it from scratch...cash, you may consider taking out a loan/mortgage to facilitate your goal of home ownership. Ambitious goal you have there and achievable too. The avenue, can be simplified by having your life insurance. How? You may ask. 

Let's just put it this way, banks are smart and they are not your friends. Facilitating your loan/mortgage means they have to put something in place, just in case down the road you are not able to pay -whatever tough times you may be facing. 

That "thing" they put in place for you is mortgage insurance. It's not for you really, you pay for it but, it is for the bank. Get it? They are protecting themselves against loss just in case you are not able to pay for your home - for whatever reason. Now, if you had life insurance - equal to or greater than the cost of the home you wouldn't have to spend thousands more on mortgage insurance. 

All you would have to do, is use your life insurance policy as collateral for the mortgage. There is a crucial point to note here. Life insurance policies gather cash value each year after a specified period of time. For you to use your life insurance policy as collateral for the mortgage, the cash value at the time of the mortgage would need to be of equal or greater value as the home, and this is the same principle for other loans.

You see, a lot of planning goes into decision making and that is why it is pertinent to seek advise from qualified persons in the field you are planning on making decisions about. I could go writing for days about choosing, effecting, utilizing your life insurance policy, but that is for another time. 

I am sticking to telling you about the living benefits of having your policy. Should you need to consult a trained and licensed insurance representative, you can visit her here: ensure.you.insure . She will be able to conduct an evaluation to determine which, and how much coverage is best for you. A tip she is sure to tell you though, is that the sooner you purchase life insurance, the it will be.

Similarly to homeownership, life insurance caters to business opportunities. Many entrepreneurs have lost a business deal because they did not have enough ready cash nor adequate collateral.

 How much does your business need? Will you be expanding? All this takes can be handled well with planning, taking the right risks and most comforting - life insurance. The cash value on your policy can be well needed help to secure your business opportunities.  

Another living benefit includes saving. While many prefer to save with the bank, some persons save with the bank and also reap savings from their life insurance! Nothing wrong with more savings. More savings, more money for you. There are policies designed perfectly to accommodate this, ensure.you.insure shares the details.

 The good highlight of savings through a life insurance policy is that it offers you more than just the savings. There is protection in the event of loss, the policy provides income tax saving which keeps pace with inflation and acts as a buffer for those tempting moments when you may want to withdraw from your savings. Now this, is a big deal.

Lady Justice, these benefits are well worth sharing as many persons would not have otherwise known that their life insurance policies can be so impactful. Not only providing peace of mind, but adding to your net worth as the cash value continues to accumulate and remains beneficial over the span of one's life.

What are you waiting for? Consult with ensure.you.insure today to carefully assess your long and short term needs to find the right policy for you.