Why Do You Need Income Insurance?

income insurance

Regardless of what you buy today, you conduct a cost-benefit analysis to assess whether the investment is really worthwhile. This also applies to income insurance, although it does not seem very important when you initially learn about it. However, as you will learn the exact benefits it has to offer, your idea for insurance and its benefits will definitely change. The following are some of its benefits:

Financial Security

The most important benefit of income insurance is the financial security it offers. Considering the instable economy we are living it, it is imperative to have financial protection. Income insurance offers you financial protection when you are not able to work due to any accidents, illnesses, or injury. Although none of the insurance policies compensate your 100 percent, you at least get 75 percent of your monthly income from the insurance company. For any individual who believe in the uncertainty of life, such protection is very important to stay on the safe side in undesirable situations.

Does Not Lead to Discouragement

Since it is quite clear that income insurance does not cover you when you are not working due to your own will, it does not discourage the person from working. It just makes the person secure when he or she is going through unpleasant circumstances due to which he or she may not be able to work. A significant portion of your income is still paid to you so that you do not have to worry about your financial concerns during bad times.

Help You if You are Disabled

Since life is extremely unpredictable and uncertain, there is no guarantee that an individual will continue to work and earn in the same way forever. Certain accidents may disable the person from working on both short term and long-term basis. Your income insurance cover will secure you and make sure you are able to get on with life.
With income insurance, you can lead a stress free life without worrying about any crisis you may face in the future.

Life Insurance – Who Is Eligible To Be The Beneficiary?

Life Insurance

A life insurance policy is taken out to provide a safe financial net for those who are dependent on you. However, there are a few regulations that are in place with who can be the beneficiary from the life insurance policy.

These can be:

Insurance policy

The spouse: it is always smarter to mention your better half by name rather than the word ‘wife’ or ‘husband’. This is because, in case of any early separation or divorce, these benefits could be transferred to your ex husband or wife. It is also recommended that the policy should be altered if in case divorce were to occur. 

car insurance policy

The children: life insurance policy should be amended after each child is born to include him/her in the list of beneficiaries. Adding your children in your life can cause you to leave out those children who are born after you make the policy. The choice of wording is also important. Minor children should not be included in the beneficiary list but instead should have a guardian to be made beneficiary till they reach the maturity age.




 

home insurance policy

Real estate: adding your property to the beneficiary list means you combine all your assets for the purpose of tax planning. This money however becomes a part of the estate and hence can be claimed by the creditors if need be.




 

health insurance policy

The creditor: sometimes insurance can help cover a creditor such as a mortgage or a loan related to business activity. There are numerous other ways that are better to handle this particular scenario, the creditor can be named a direct beneficiary of the policy.
 

life insurance policy

Testamentary trust: this seems to be an appropriate candidate for a beneficiary but the law is still hazy in some states over the matter of whether or not this leaves the proceeds from the estate out. It will help in credit shelter tax planning.

Level Term Life Insurance and Its Benefits

life insurance

whole life insurance

Level term life insurance is simple to understand. As the term suggests, the premiums are fixed at a constant rate and do not change throughout the course of the policy. Most people will take out this kind of policy when they want to secure themselves for a particular time period. Such a level term life insurance policy will be short term.
This policy is unlike whole life insurance. With whole life insurance, the cost increases with time – thanks to its investment aspect. With level term life insurance, the premium and hence the cost of policy remain the same throughout so you know exactly what you’re getting when you buy such a policy.

term life

There are certain things to consider before you decide to take out a level term life insurance policy. Firstly, you need to decide how much coverage you need. This is linked to how much you make on a yearly basis. The rate of premiums will also be a deciding factor; you need to establish how much of this payment you can afford to make.

Despite the fact that your premiums will remain constant without rising, you will still have to make the payment every month. The next deciding factor is the amount of time you need the coverage for. Level term insurance can be taken out for 10, 20, 30 and 40 years. The longer the period of your coverage, the higher your premium will be.

 If you are looking to take out a life insurance policy, then level term life insurance will prove to be a cheaper option when compared to whole life insurance. This is because you get a clear picture of how much you will pay every month without the fear of your premium increasing with time as is the case with whole life.

life insurance companies

life insurance logos

health insurance

car insurance

home insurance

medical insurance