Wednesday, July 15, 2009

knowledge about life insurance

Author : Nitin Soni

It is the part of the human equation. Just as we rarely give thought to our health, unless something goes wrong, most of us are too busy living life to stop and wonder if our life insurance coverage is adequate. Would we be able to create security for our family if we should die unexpectedly? If you know anyone who's endured the sudden loss of a loved one, it goes without saying that it can be a devastating blow. Now think how much more overwhelming this would be without sufficient life insurance.

What can life insurance do?

If something were to happen to you, what could you expect your life insurance to do for your family?
It could provide:
1 A comfortable standard of living for your family.
2 Payment of any debts or expenses.
3 A source of income for loved ones.
4 A legacy to your favourite charity

Today's life insurance policies aren't limited to providing for loved ones after you're gone. They can be used to build savings. You could use these tax-saving funds to supplement your retirement earnings or to provide long term care for a spouse. You'll want to ask your financial advisor about the many options available for accessing your policy cash values.

From creating an instant estate for your loved ones to getting a quick cash value return if you should ever need money in an emergency, life insurance can do more for you than you may have thought.

Insuring your plans
Whatever dreams you're planning for, even when your circumstances have changed, life insurance can help you reach your goals. What if you've been fortunate enough to build a large estate? A provision to pay off any taxes due after you are gone will insure that your beneficiaries won't have to shoulder any unexpected costs.

While there isn't really a right or wrong time to buy life insurance, it is wise to shop for life insurance when you don't need it. In other words, when you are building and creating plans for the future. You can always make adjustments as your circumstances change, but the key is to know what your insurance needs are right now. The provider will usually contact you once or twice a year.

You may opt for a permanent life insurance policy, with a cash surrender value. Young couples that are just starting out might prefer the lower cost term life insurance. The best solution for you could be a combination of permanent and term policies.

Some people aren't comfortable with brokers because of all the personal questions they ask. Although financial planning and estate planning is a personal thing, bear in mind that the best possible coverage for you and your family is one that is tailored to your needs. It will benefit you to have a professional who understands life insurance and who can explain the various policy advantages to you. That includes asking the right questions along the way. After all, those few uncomfortable moments could mean years of security for you and your loved ones.