It is not that common for people to go and buy a life insurance policy themselves. Mostly we don’t even think about it; we usually get to know about it if someone from our friends or colleagues opts for it. That’s how it is anywhere in the world and not just in the United Kingdom; life insurance policies have to be sold to us; instead of us trying to find one for ourselves. There is no specific reason why that’s the case, but if you require convincing to do something that is good for your future, then this article will list the six main reasons relaying the importance of life insurance.
You pay for your funeral
As strange as it may sound, doing a funeral can cost as much as getting married in some cases. The average cost of funerals in the UK after consulting different sources is around £4500 which can rise up to several thousand pounds because it also adds the average price of burial £4500 and the collective value of cremation is around £4000. Some of the other expenses included in the total funeral expenditure also have the director costs, third-party costs and optional additional costs. When you die, you wouldn’t want your family members to deal with, such a massive financial burden, so it makes sense to prepare for your funeral beforehand. Having a life insurance policy contributes massively towards that, and your loved ones won’t have to suffer more when they are already going through a tough time.
Looking after your family
Most people do not realise this, but everyone in the family depends on each other, and that becomes more obvious when someone isn’t alive anymore. It becomes even more severe if the person who has passed away was the one who was the sole provider of the family. When the primary source of income isn’t there, it means the family will face a crisis no matter how hard they try if there wasn’t anything planned for them. Therefore, life insurance can be the key to save your loved ones by making sure they will have enough money in their hands through your coverage that they will be able to deal with everything including their education, the daily expenses and bills to maintain their lifestyle.
Paying off your debts
While everyone tries their best to do things within a specific time frame, you never know when a sudden accident happens, or a person dies. Life insurance has many benefits, but one of the most underrated ones is that your loved ones can pay off your debts if there were any left from your side. The main one is, of course, mortgage that most families have to deal with throughout their lives. If you aren’t alive anymore and suddenly your family doesn’t even have enough money to make ends meet let alone pay off the mortgage or any other loans that you had borrowed it will be unjust. Also, if someone has the money available, you wouldn’t want to put them in a situation where they have to spend their money on something that was your doing.
Flexible options and multiple benefits
Life insurance policies are for life, but that does not mean that you will be bound to follow everything as they have been mentioned in the deal you have purchased. Most life insurance providers allow their customers to make changes in the arrangements as time passes, based on the changes in circumstances. You have the option of increasing or decreasing your benefits. People can also get discounts on the insurance policies if they take the cover with their spouse or add children in as well. Another significant advantage is that you can bundle the plan with any other covers such as income protection. Hence, you have a wide range of choices that you can benefit from and customise them appropriately based on your situation.
For your business and taxes
Another reason why life insurance is so important is that you can pay off your estate taxes through this option. Usually, this option is only suitable for people who have large estates and is not possible to cover the taxes under term life insurance, and you typically have to go for permanent life insurance to make sure everything lasts until you are alive. If you have saved up money for your retirement or made any plans, then having life insurance serves a great purpose. Also, if you have a business running and suddenly something happens to you, then the company will be destroyed within days. Life insurance provides financial cover to your business where there is enough money to keep the daily routines going and keeping the supply chain running so that it does not have a negative effect.
To leave an inheritance
Every person who leaves this world wants to benefit the people they leave behind. Life insurance can be one of the most significant contributors in that regards as you will be able to provide an inheritance for them. If you have nominated your beneficiaries, then they will get the money from your life insurance policy that can contribute towards their legacy. There can be a situation when there isn’t much left behind due to several reasons, and even if you have your estate, it isn’t too much. Life insurance can be the icing on top of everything that you already have. In this way, you are leaving your children and spouse in a healthy financial situation.
All in all, a person who has life insurance will have that peace of mind knowing that they have covered everything that they could think off. From making sure they do not become a burden on their family members and also ensuring that they have left behind something that will benefit their loved ones can go a long way to giving you that satisfaction in life.
