What Is The Importance of Life Insurance?

No matter what your personal situation may be, having a life insurance policy is important because it helps to provide financial assistance for your loved ones when you die. Fully understanding your life insurance policy is necessary so that you can plan your finances and make sure that the people in your life are taken care of when you are no longer with them. If you have questions about your life insurance policy in San Diego, California, Windfall Insurance Services Inc. is here to help. In this blog, we will discuss the importance of having life insurance and different options that are available to you.

How Life Insurance Works

A life insurance policyholder makes a monthly premium payment to an insurance company, and the company then pays a death benefit to the policyholder’s designated beneficiaries when they pass away. There are two principal types of life insurance; permanent and term life insurance. A permanent life insurance policy will cover a policyholder throughout their entire lifetime rather than a specific term, and will increase in value over time. There are a few different types of permanent life insurance to choose from, including universal life, whole life, and variable life. Term life insurance coverage lasts for only a specific period of time, and usually less expensive than permanent life insurance. If a policyholder dies during the period of coverage, the beneficiaries will receive the specified monetary amount, however, if the policyholder dies outside of the covered period, there is no death benefit payout.

What Are The Benefits of Having a Life Insurance Policy?

Having a life insurance policy can offer several benefits in addition to protecting your family and legacy. Life insurance can be used to help pay off any outstanding medical and funeral expenses, as well as other debt including a mortgage, credit cards, student loans, etc. It will give you the peace of mind that your family will have financial stability when you are gone, and it is important to note that death benefits are typically tax free for the recipient. You can also use life insurance for other living costs, such as long term care for elderly family members. Life insurance can be bundled with other types of insurance, can help add to your income if you cannot work, and certain policies can even be withdrawn from and borrowed against while the policyholder is alive in order to supplement retirement or for other reasons.

Determining The Most Suitable Life Insurance Option For Your Situation

Having good life insurance coverage can give a policyholder peace of mind that their family will be taken care of and can also benefit them throughout their lifetime. If you are located in San Diego, California, and have questions about life insurance, contact Windfall Insurance Services Inc. today for a consultation.