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Florida Life Insurance - Protecting Your Family with Life Insurance
The loss of a loved one can mean emotional devastation for a family, but the last thing they need to encounter is financial hardship. When the loved one lost is the primary earner in the home, life insurance can be the safeguard that prevents a family from falling into a financial abyss. Life insurance equals protection against financial loss resulting from the death of a family member, such as a husband or wife. Through a life insurance plan, a life insurance company’s pledge is to pay your beneficiary a specific amount of money when you die, in exchange for the payment of premium payments in a timely manner and usually on a monthly basis.
While it may not come to most people’s minds, earning income is a significant asset. Life insurance helps replace that lost income in the event of premature death.
In the event of a tragedy, the proceeds from life insurance can help pay a family’s or spouse’s bills, keep a family business on track, guarantee future financial needs are met, like a child’s college education, and protect a spouse’s retirement plan. If a family does not have life insurance, the result could mean that one spouse is left to deal with the financial chaos that can result when mortgages and debt are involved.
A death benefit can protect a family in the following ways:
Replace income the family would need to maintain their standard of living after the death of the primary wage earner or secondary wage earner.
To pay off a home mortgage loan and other personal and business debts, such as credit cards, business loans, and car loans. If life insurance is not in place, in some cases, families could face foreclosure on their home, or lose a business that has been in the family for decades.
To establish a fund for your children’s educational future, such as expenses related to secondary education and tertiary education.
To pay final expenses, such as funeral services, burial costs and taxes.
To set up a family emergency fund or a trust for a family member who has special needs or disabilities.
When choosing life insurance, who you name as life insurance beneficiaries is also a factor to consider when protecting your family. When choosing a beneficiary, you should always name a secondary beneficiary in case you outlive your first choice in a beneficiary. You should also choose a specific beneficiary, rather than have insurance proceeds be paid to your estate. If you make the policy payable to your estate, it will have to go through probate, which will prevent benefits being paid immediately to your beneficiary.
When setting up life insurance, you should also be specific in wording the beneficiary. Saying “husband of the insured” could mean an ex-husband could get the proceeds, while naming specific children may exclude those born later. Your agent will help you through this process.
While there are many details to consider when choosing life insurance, it could be the best investment you make in your family’s future.
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