Nothing in life is more scary than facing the only non-negotiable thing of our life & that is death. To date, death is a certainty. Along with this mortality comes an unpredictable existence and a fear of the unknown. It is unnerving for people to think about the thought of their own death or the death of someone they love. Thus you must be prepared at all times. In today’s life, which is filled with unpredictable & uncertain events, where we are having so many responsibilities to be fulfilled in one life and there are people who are dependent on us for their happiness and comfort, protection of one’s life becomes inevitable because there is nothing more important than your family’s security. We cannot ensure that we will be with them in their time of need, but what we can ensure is that we put together a means for them in times of worry and need.

It is a natural human tendency that beginning with the dawn of time, we use to protect our belongings. This natural instinct gave rise to the need for protection against most losses, which is how life insurance came about. Life insurance is the only answer to all such erratic & unpredictable events in humans life. Remember, it is not just your life you are insuring, but the lives of your loved ones as well. When we can ensure our homes, cars etc. then why don’t we feel the need to ensure the most important thing and that is Life. In this fast paced, fragile life style with less life span which we have today, insuring life itself has become a necessity especially if you are the sole breadwinner of your family. It is not mandatory; but you cannot afford not to have it ! Insurance helps us in getting protection against the unseen. Thus it may be wise to purchase life insurance so that if something happens, your insurance policy could serve as a protective shield to those you leave behind. An old adage, “The grace of GOD is like insurance. It will help you in your time of need without any limit” is not just a cliché and is rightly said.

What is Life Insurance?

It is a contract between the policy owner and the insurer, where the insurer agrees to pay a designated beneficiary a sum of money upon the occurrence of the insured individual’s death or other event, such as terminal illness or critical illness. In return, the policy owner agrees to pay a stipulated amount at regular intervals or in lump sums. Simply putting, it is a way to replace the loss of income that occurs when someone dies. It ensures that your family will receive financial support in your absence. It can be a great way to get protection for now and to plan for the future. After all, we want to make sure that our loved ones are taken care of if we die.

Insurance has turned out to be a very common term in the recent times. You can come across this word wherever you go and which ever magazine or newspaper you read. In fact whenever you hear about insurance, some means of protection & security comes into your mind. It is essentially the means to financially compensate for losses that life throws at people.

Why you need Life Insurance?

Life insurance is one thing that everybody needs to believe about. Parents think about it for their kids, and once you are a grownup, it is some thing that you simply get taught about. It is no longer for the privileged or only the elderly. It isn’t just for any one type of person. It is a universal protection for everyone. What insurance does is provides protection for your loved ones in case of your death. If you have a insurance policy in location and you pass away, that coverage may grant the cash to the beneficiary with the policy.

Life insurance isn’t for the benefit of the person who is insured, but it is for the insured’s loved ones because your family needs the guarantee of a comfortable financial future in the event that something should happen to you.

The primary purpose of life insurance is to enable your family to continue their current lifestyle when and if you’re no longer around. It is also designed to help meet specific needs that your family will have in the future.

If you have a life insurance policy in place, it could:-

1. Provide a financial security to your family
You would want the surviving members of your family to live in a safe and financially stable environment. Life insurance could allow them to do that so that your family continues to live a comfortable lifestyle as before. It will replace your lost income in the event that it goes away in the future. In other words, it creates a safety net of relief for the family that would be left behind without any other means of income.

2. Help in paying your debts
Life insurance could pay for remaining medical bills, funeral expenses, and credit card debts, and enable the surviving spouse to have some time to find a job or to retire comfortably. Just imagine if you are suddenly out of the picture, you wouldn’t want to leave your family to drown in a sea of debt. There comes the life insurance coverage that will help your loved ones to maintain their standard of living.

3. Provide finances to your loved ones to achieve life’s goals in your absence
An adequate life insurance policy will fund your unfulfilled goals like a quality education for your children, daughter’s wedding, for buying a piece of land, or just for a rainy day.

Thus it is not an insurance for you but its for your family’s peace of mind. Their future standard of living may well depend on the life insurance decisions that you make today.

Types of Life Insurance policies:-

Life insurance comes in many shapes and sizes, but the different types of policies can be broadly classified into two categories:

1.Term insurance and
2.Permanent insurance

Term insurance is the insurance policy under which the death benefit is payable only if the insured dies during a specified period & this policy does not have any investment component. It is the most affordable type of life insurance available. It is designed to meet temporary insurance needs; providing protection for a specified period of time, the term. This type of insurance makes sense if you have financial needs that will diminish over time, such as a home mortgage or a child’s tuition.

Each year, a premium is paid to cover the risk of death during that year. Term life insurance has no cash value. The only way to collect anything is to die before the term life insurance expires. If death occurs, the life insurance beneficiary generally collects the death benefit of the insurance policy, free of income tax.

Permanent insurance is the insurance policy that provides coverage throughout the insured’s lifetime and may include an element that builds cash value. This type of policy provides lifelong protection. It also provides a savings element that accumulates a cash value over a long period of time. In other words, this type of policy, combine life coverage with an investment fund. Here, you’re buying a policy that pays a stated, fixed amount on your death, and part of your premium goes toward building cash value from investments made by the insurance company.

No one type of life insurance is better than another because the type of insurance that suits your situation best depends on your personal and financial circumstances.

Final takeaway:-

You might have heard of the saying, “There are worse things in life than death. Have you ever spent an evening with an insurance salesman?”. If we go by the saying, if you haven’t yet met an insurance salesman, then speak with him today to get your & your family’s life financially stable & secured. Do not leave your family to drown in a sea of financial difficulties because we know that risks and uncertainties are part of everyone’s life & they are all waiting to happen.

About the author

Life Insurance,
Life Insurance India