Why life Insurance matters

We protect ourselves and our families with all sorts of insurance: health, auto, home, travel and more. For most of us, the coverage is (luckily) never used, or we don’t get the maximum benefit returned. It’s a back-up plan. It’s “just in case” security.

Life insurance is different, however. Someone – the policyholder, their loved ones, their business, a charity – will ultimately receive a benefit. Your investment isn’t a back-up plan … it’s a definite plan.

Filling a need

Life insurance isn’t for the dead. It’s for the living. Not only does it offer peace of mind for your surviving loved ones, but it can also offer solutions and benefits you can use to lead a fulfilling life. Here are the four main benefits of life insurance:

• Death benefit protection
  In a time of grief, a life insurance policy can help with medical bills, funeral costs and other immediate expenses, ensuring a family has financial support when it’s needed most. It can also help replace lost income for the future, providing loved ones with a better chance of continuing their current lifestyle.

• Cash accumulation
  Life insurance can be part of a diverse investment portfolio. In some products (universal and whole life) a portion of what you pay (the premium) earns interest. The gain is tax-deferred until withdrawn and can help fund financial emergencies, retirement income or college expenses.

• Income tax benefits
  Typically, the death benefit on a life insurance policy transfers to beneficiaries free of federal income taxes. Additionally, earnings from accumulated value are not taxed until withdrawn.

• Estate planning
  Regardless of the size of an estate, this can be a major consideration. Integrating life insurance into an estate plan can offer a number of benefits, including avoiding family conflict, protecting other assets or providing trusts for beneficiaries.