Who Needs Life Insurance?
Life insurance for many people is something of an enigma. There are many different companies offering (BMO life insurance, TD life insurance and CIBC life insurance to name a few), but idea of being paid money after you've died for many people seems counter-intuitive or nonsensical. Surely after you're dead you won't need any money? Of course for some people this is indeed the case and not everyone will find that they need life insurance. However for certain groups it is absolutely paramount that they do and it can be the difference between your family surviving without you or struggling and being moved out of their home.
To understand who needs life insurance it's important to first of all get a good understanding of what precisely life insurance is and what it provides. Essentially, life insurance does pay out after you've died, but unlike other forms of insurance it obviously isn't you who receives the cash. Rather the recipients of your life insurance will be those left behind - namely this is normally your family.
When you take out life insurance then, you are guaranteeing (assuming you've chosen your life insurance policy well) that your family will be able to continue to enjoy their current way of life should you die. Essentially then, you pay out your life insurance on a monthly basis, and then your family gets the payout after you die. This payout depending on your policy can be a one off lump sum of money, or it can be several smaller payments depending on what you prefer. However, either way it will ensure that your family gets some money after you die and this then means that they don't have to face both the huge emotional turmoil and the financial problems of losing their main income at the same time which could result in their becoming in debt, having to sell the house, or losing out on your children's education etc.
It's very important then for anyone who is supporting a family to take out life insurance so that they can continue to do so and be confident that they will at least be supported financially. This doesn't mean just taking out life insurance if you're old or unwell however, instead it's important for anyone who has a family - as you never know what's waiting around the corner. However it is fair to say that certain situations and conditions might make life insurance more important. For example if your job is a lion tamer then you might want to ensure that you take out some form of life insurance even more quickly than otherwise.
At the same time it's not just the main 'bread winner' who should take out life insurance. It's also important for anyone else supporting the family either emotionally or financially to do the same. For a housewife/stay-at-home-mum for instance it is highly important to allow your partner to focus on the children after your death. If you do not take out life insurance then your husband would have to either stay at work and put the children in care during the day, or take time off and be faced with serious financial difficulties.
Bear in mind however that all of these different demographics will not necessarily need or be able to use the same life insurance policy. It is crucial then to look around at different life insurance policies such as TD life insurance, Desjardins insurance and BMO life insurance to decide which is best suited to you.
by: Rachel Hammons