Life insurance can be an essential element of financial planning because it can help ensure that your dependents are protected financially when you pass away.
How Does Life Insurance Work?
Most people use life insurance to help financially support their loved ones upon their death. Generally, in exchange for paying a monthly, quarterly or annual premium, a life insurance policy pays out a death benefit to one or more named beneficiaries when the insured person dies.
Benefits of Life Insurance
There are many benefits to having a life insurance policy, some of which include the following:
- Life insurance may help provide financial security. If you have loved ones who depend on you to pay for everyday expenses, life insurance can help replace the loss of your income when you pass away.
- Life insurance may help pay for a child’s education. A policy’s death benefit can be used to pay for a dependent’s education.
- Life insurance may help leave a charitable legacy. You can designate a charity as a beneficiary to make a larger gift than might otherwise be possible.
- Life insurance may help supplement retirement income. If you purchase permanent life insurance, you may be able to use the policy’s cash value for retirement income.
- Life insurance may help cover the cost of medical bills. If you pass away due to health-related issues, your life insurance policy could help your loved ones pay for accrued medical bills.
- Life insurance may help cover final expenses. Life insurance can help pay for end-of-life expenses, such as cremation, burial and funeral services.
- Life insurance may help cover remaining debts. When you pass away, your debts most likely will not just disappear. In many cases, those debts may become the responsibility of your loved ones. Your life insurance may be able to help cover these payments.
Does Life Insurance Have a Cash Value?
Permanent life insurance can include a cash value component. With these policies, a portion of each premium paid goes toward insuring your life, while the other portion goes toward building up a cash value. The cash value portion may also accrue interest. Depending on the type of insurance policy you have, you may be able to access its cash value by making a withdrawal, taking out a loan against the cash value, surrendering the policy or using the cash value to help pay premiums.
Life Insurance Quote in Brunswick, OH
If you want to learn more about the benefits of life insurance, contact Arbutina Insurance Group. We can help you find coverage you can be confident in.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.