The Reasons Life Insurance For Parents Is So Important

If you are a parent, then this post is for you. If you are not yet a parent but are expecting, then this post is for you too. Before having kids, most parents out there never gave life insurance a thought. I mean think about it…. planning for your own possible demise is not something we as humans like to think about and I know for me when I was young in my 20’s, life insurance was something that never crossed my mind. But, if you have kids and a family, or even a new baby on the way, finding life insurance for parents is a must. This policy will help you to prepare and ultimately it will give you peace of mind, so that in the event something does happen to you, you know that your family will be taken care of. Below are several things to keep in mind when looking for that perfect life insurance policy to care for your family in the event anything were to happen to you.

Do Families Really Need Life Insurance?

Life insurance is a must for families as mentioned above because you want to make sure your children and spouse are taken care of in the event that something happens to you. If you have kids and/or a mortgage…… it is extremely important because children depend on their parents to care for them and are extremely dependent. It would be a good idea to also take a look at insurance companies by age group, so that you can plan for now and the future, as your circumstances to do change over time. Term life insurance might be the way to go as it is appropriate for the average family. Now you may be wondering what term life insurance is….well it is a life insurance policy with a set duration. Here is a good example… let’s say you take out a term policy at age 30 and it is set to expire in 30 years. At this point it is up to the policy holder to renew the policy at the end of the 30 year term. Term insurance is usually the most economical type of insurance coverage and it is appropriate for both parents, even if one is a stay at home parent as they contribute to the families overall financial security by working from home and contributing to the homes income or through large savings in childcare.

Do You Ever Have To Re-Evaluate Your Life Insurance Coverage?

This is something to look into whenever a major life event happens. Maybe a new baby is on the way, you’re buying a home or maybe you have significant changes in lifestyle or salary…. when any of the changes take place…… re-evaluating your policy is the smart move. Also, if you have a term insurance policy, you will need to re-evaluate your policy when it is nearing it’s end and renew it if need me.

How Much Coverage Do Parents/Families Need?

This really depends on your lifestyle and income. There is really no formal rule here and life insurance for parents should help to substitute your current and future income, while also being able to take care of current outstanding debts, such as the mortgage on your home and also for future debts, like your child’s college expenses. When it comes to the math, as an example…. a 30 year old earning 55,000 a year, would have over 1,000,000 in earnings over the next 20 years, and that is not taking into account for any possible future adjustments, like inflation for future earning increases. Make sure to put those future adjustments into perspective when assessing and planning for you life insurance policies.

What Type Of Life Insurance Is Right For You?

Finding the right insurance policy to suit your needs is important. Term insurance coverage is the most common as it is straight forward and economical. It is important to research different insurance carriers and look for the ones with strong financial ratings. Then finding a reputable company with the lowest premium, should be the deciding factor as you want it to be affordable too.

Now when it comes to insurance carriers, their rating should not be considered as they receive credit ratings from five major rating agencies, and these ratings are publicly available. These ratings can give  you an idea of a carrier’s financial strength and overall reputation which is important as with term insurance, the obligations may need to be paid in 20 or 30 years and you want to make sure the carrier is going to be around for the long term.

Are There Benefits For Families To Work With An Independent Insurance Broker?

An independent insurance broker provides insurance expertise no matter the type of coverage you are looking for. Whether that be choosing a life insurance policy, choosing life insurance companies for cannabis users, navigating the details of the policies, carriers and underwriting can most definitely have significant effects on the outcome of both the underwriting offer and ultimately the cost of the policy.

Life insurance for parents is a must and it can help you to rest easy knowing that in the event that something happens to you or you spouse…. your family will be cared for. I have not discussed all types of insurance available on the market as there are some types of life insurance policies not discussed here that are exceptions to the rule. Make sure to do your research and prepare as life insurance should not be viewed as expensive but as a small necessary cost to move financial risk from you and your family, to someone else, an insurance carrier. The benefits are huge and the peace of mind is priceless in the event of an untimely tragedy as you can rest assured your family is protected and cared for.