The importance of life insurance

Did you know that September is Life Insurance Awareness Month?

Talking about life insurance might seem boring or morbid but your family will definitely appreciate the time you take to figure it out. If you don’t already have life insurance, ask yourself this question;

How will my loved ones manage financially after I die?

There are many types of life insurance that might be appropriate for your situation but they all essentially aim to answer this one question.

When you die your family will be responsible for covering your final expenses. Can your family afford to pay for all these things?

  • Funeral and burial costs (which can cost thousands of dollars!)

  • Household bills and ongoing living expenses

  • Time off work (to handle logistics, take care of children, and to grieve)

  • Pay off debt (like credit cards and the mortgage)

  • Finance future needs (like your children’s education)

  • Protect your spouse’s retirement plans

To cover this financial burden and protect your loved ones from going into debt, you’ll want to make sure your policy is enough.

Deciding on how much coverage to purchase can depend on many factors, this means that no single policy can be right for everyone. The coverage you need will depend on the specific costs your family will need to cover and, the loss of your income (if you were working.) For parents who stay at home with children but don’t earn a salary, you’ll still need life insurance on them. The surviving parent will likely need to take a significant time off work and therefore will have a salary loss. Don’t forget to consider, the parent who stays at home is providing services for the family that would be expensive to replace, such as transportation and childcare. 

To calculate your insurance needs you can use our online calculator:

Reevaluate regularly: Life insurance can give you peace of mind, but it’s not something that you can purchase once and then never think about again. As life changes it’s important to reevaluate your insurance policy and update it if it makes sense. Here are some life changes that should cause you to review your current policy:

  • Getting married

  • Becoming a parent or having another child

  • Buying a home

  • Changing your job

  • Retiring

Look for the next blog post which will give you some insight into the various types of life insurance and how you can go about purchasing a policy!

Thanks for reading,

Kara P.