A question you might have asked yourself as you consider your financial future is “how exactly does life insurance protect my loved ones?” This guide will detail five ways that life insurance protects your loved ones to help put your mind at ease.
- Pay off debts and provide income
One of the biggest benefits of a life insurance policy is that it can be used to help your family to pay off any debts that may have earned. From high-interest unsecured debt from credit cards down to a car loan, these debts can be difficult to pay off and may be something your family would struggle with without your life insurance.
You can even get group life insurance from your employer, which is often included in employee benefits schemes. You can rest assured that in the event of your death, your family will receive money to help ease financial pressures in what’s already an incredibly challenging time.
- Funeral costs
Although it’s something nobody ever wants to think about, your passing can have huge financial implications on your family. Not only are they coping with grief, but they also have to find the strength to deal with general end of life costs alongside funeral and burial costs. The average cost of a burial funeral in the UK is approximately £5,033.
A life insurance policy could cover or at least help with these final costs, allowing your family to grieve your passing without having to worry about the associated money.
- Education costs
Even if your child is years off from graduating from school, their future is still worth considering when thinking about your life insurance policy. The proceeds from life insurance can go a long way towards funding further education.
Recipients can put their life insurance pay-outs into a specified higher education savings account to make sure that the funds will be ready whenever the child is ready to go off to university.
- Leave a legacy
One way that you can give to all of those in your community or loved ones is by making a charity the recipient of your funds on your life insurance policy. Provided your family has no need for the income your life insurance policy will offer, this is a fantastic opportunity for you to give to those you otherwise wouldn’t be able to afford to give to. Your family could give talks, donate or become regular visitors to your given charity, keeping your legacy alive even when you’re gone.
- Support your own needs
Life insurance isn’t only useful when a person has passed away either.
If you’re very ill and require a lot of equipment or medicine to keep you healthy, a life insurance policy will prevent your loved ones from having to fork out for the stuff you need. Bandages, prescriptions, oxygen machines etc. can become very costly when they’re a daily requirement, so by having a life insurance policy you’re protecting the finances of your loved ones, enabling them to better take care of both themselves and you.
There are many policies to choose from so be sure to look around and find one that best suits your needs.