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7 Facts You Didn’t Know About Life

Life insurance, despite being vital, remains one of the most misunderstood financial instruments. Many wouldnu2019t want to talk about Life insurance because they donu2019t want to talk about death or just undermine the possibility of a disability or illness.<br>

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7 Facts You Didn’t Know About Life

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  1. 7 Facts You Didn’t Know About Life Insurance Life insurance, despite being vital, remains one of the most misunderstood financial instruments. Many wouldn’t want to talk about Life insurance because they don’t want to talk about death or just undermine the possibility of a disability or illness. However, Life insurance is one of the pillars of personal finance and is deserving of consideration and attention by every household. Here is a low-down on some of the facts of life insurance which are lesser known or often ignored. 1. Your financial plan is far from complete if it does not include Life Insurance You might have designed a short-term and a long-term financial plan, with all kind of financial milestones, and feel great about it. However, without Life insurance, it is just another academic effort. A sound financial plan must include consideration for life insurance on you and/or your significant other, that will help your loved ones to continue sustaining a sound quality of life if you are not there. Life insurance is an important part of your long-term comprehensive financial plan. Texas P&C Insurance Agencies, Inc. https://www.texaspnc.com/

  2. 2. Life Insurance is not an Investment instrument Well, philosophically speaking, Life insurance is an investment – since it brings peace of mind. Not so in real financial terms, if you consider its under-par performance as an investment instrument. Experts insist looking at Life insurance as ‘primarily a risk management tool’ and to consider other financial instruments if your aim is to generate wealth to meet your financial goals. 3. You need more coverage than you think you do Many people would buy a life insurance policy just to tick it off the checklist or would decide on the coverage based on their current income. However, inadequate coverage will not serve the risk management objective. Remember, every time you pay insurance premiums, you are actually working towards providing your family with an invisible financial backup in times of need. And you would want that backup to be good enough to maintain financial stability for your family. 4. You need Life insurance even if you are not the breadwinner Strategically, Life insurance helps your loved ones to compensate for lost income and cover costs. So, obviously life insurance is vital for the bread winner of a single-income household. However, it could still be important for a stay-at-home spouse or parents. For instance, a Stay-at-home parents perform valuable services such as childcare, cooking and household management, which can be costly to replace for the survivor. You need to think about what your needs will be if that person is no longer there. 5. Life Insurance is not just about benefit payout in case of death Many believe that life insurance policies only offer financial support in cases where the policyholder is no more. However, there are policies in the market that offer very good accidental disability or critical illness riders. These riders pay the specified sum insured if the policyholder becomes accidently disabled or experiences a critical ailment. This can provide a vital safety net for you and your family if you are no longer able to work or are working in a limited capacity. 6. Life insurance could be surprisingly affordable According to a research, most people assume life insurance costs to be 3 times what it actually is. In reality, it is a fraction of your overall spending. Let’s take an example – A term life insurance for a healthy 30-year-old will cost about $13 per month, whereas a pair of movie ticket with popcorn and drink will cost almost double that. Amazing, isn’t it? Texas P&C Insurance Agencies, Inc. https://www.texaspnc.com/

  3. Having said that, life insurance can get expensive if you have health issues or do not follow a healthy lifestyle or if you fall in for the bells and whistles of a life insurance product. Remember, age and health are costs factors for any Life insurance product. 7. You can take a loan against your insurance policy Surprised? Yes, that’s true. If you have a life insurance policy – except for Term policy - you can take a loan against it. It’s a great way to gain access to some additional funds without offering any assets as collaterals. In other words, a plan that comes with a maturity benefit can also be used as collateral while borrowing funds, providing you with financial flexibility when you need it the most. Texas P&C Insurance Agencies, Inc. https://www.texaspnc.com/

  4. It’s not surprising that there is not enough understanding of Life insurance, given that it is a low touch product. We, at Texas P&C Insurance, can assess your insurance needs and suggest the right life insurance policy at the right cost. You can call us on (972) 293-2139 or contact us online here. Texas P&C Insurance Agencies, Inc. https://www.texaspnc.com/

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