Life insurance is a financial protection plan that provides a payout to designated beneficiaries when the policyholder passes away. It helps ensure financial security for loved ones by covering expenses such as funeral costs, outstanding debts, mortgage payments, and future living expenses.
A policyholder pays regular premiums to an insurance company in exchange for a death benefit that is paid out to beneficiaries upon their passing. The amount and duration of coverage depend on the type of policy chosen.
Life insurance is beneficial for:
Life insurance provides peace of mind, ensuring that loved ones are financially protected in the event of an unexpected loss.
People typically purchase life insurance at key life stages when financial responsibilities increase. Some of the most common times to buy life insurance include:
Couples often purchase life insurance to protect each other financially in case of an unexpected loss.
New parents buy life insurance to ensure their children’s financial security, covering future expenses such as education and daily living costs.
Homeowners may get life insurance to cover mortgage payments, ensuring their family can keep the home if something happens to them.
Entrepreneurs often purchase policies to protect their business, cover debts, and provide stability for partners or employees.
Some individuals buy or update life insurance policies later in life to cover final expenses, leave an inheritance, or supplement retirement income.
People may buy life insurance after a health scare or diagnosis to secure coverage while they are still eligible.
As income grows, individuals may increase their coverage to match their higher financial responsibilities.
While younger, healthier individuals typically get better rates, life insurance can be valuable at any stage of life to provide financial peace of mind for loved ones.