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Many of us would think of life insurance as a necessity that has to be fulfilled. However, few of us give sufficient thought about the details involved in a life insurance policy. In other words, while people would be able to answer readily to the question, ‘what is life insurance’, there is inadequate understanding when it comes to responding to the query, ‘why life insurance’. And as it happens, there are different needs for life insurance during different stages of life.
Normally, people would not be paying heed to their life insurance needs during this honeymoon phase of their lives. However, risks are always part of the game, and it pays to play it safe. Financial needs are not all too pressing in this stage of life, as there are little commitments, high ambitions, and lots of energy to be productive. But then, any unexpected changes and sudden developments could throw you off-track, unless the family has planned a life insurance Policy for their needs.
If the family has grown and has a kid or two, the financial situation becomes a bit more dramatic – there are expenses, both expected and out of the blue, which need to be provided for. A Term plan is even more crucial at this stage of life; when one of the two incomes, as is increasingly the norm these days, is taken off the picture, the family would be burdened with increased expenses and less means to meet them. It becomes an even worse scenario if one of the couples is a homemaker and if the main breadwinner were to pass away. This is why life insurance increases in its significance as the lifecycle develops in a typical family.
As harsh it may be, separation becomes inevitable in some cases, replacing sweet memories with bitter ones. But even worse would be the practical realities associated with the financial repercussions of separation. If the family had planned their future with both the incomes in consideration, dealing with a divorce or separation can be painful, unless there is a term plan in place that is planned for a tricky future. And what is life insurance that cannot come handy in times of need and desperation?
The need for life insurance policy does not depend on such dramatic developments as separation or divorce alone. Life is never a bed of roses, and there may be times when thorns become prominent. In these days of contingent workforces and non-permanent jobs, nothing can give you comfort and peace of mind like life insurance that is worth at least 7 times the annual income of the family. While you need not imagine a dark future, it is always a good idea to be prepared for a rainy day. Mortgages to be paid and loans to be served become particularly onerous if the main breadwinner or one of the two incomes of a household ceases to exist all of a sudden.
Retirement planning is something that you can seldom take lightly, no matter what situation you are in and how well off you seem at the prime of your working age. Life insurance is a much more pliable and customised proportion these days than what it was in the earlier stages of its evolution. Anyone genuinely concerned about their family’s welfare when the chief breadwinner is well past their prime should consider a term plan or other options in life insurance to breathe easy and stay relaxed. Life insurance policy is equally applicable in all stages of life.