Life insurance is confusing and sometimes a scary topic for many people. Among other confusing bits of information, many people wonder why exactly they should carry life insurance and how it can protect their family. Allegiance Insurance Agency of Richardson, TX wants to answer these questions for you.
Life insurance is insurance coverage that is given to your beneficiaries when you pass due to a covered event. The amount of coverage and time limit of that coverage depends on the insurance you obtain. For instance, you might either choose term life or whole life. Term life is insurance that covers your death for the specified period of time you choose. Whole life covers your death for your entire life, as long as you have paid your premiums and your death is due to a covered event.
When the insurance payments are given to your beneficiaries, they can use it for what they need. A portion of it typically goes to cover your funeral costs, unless you have prepaid for your burial and service. After those costs are covered, the money can be used toward anything that the beneficiary sees fit to spend it on. Many common ways it is spent include the following:
- To pay off any debts left in your name, including mortgages and vehicles. This helps to ensure that your family can stay in the family home as opposed to losing it if they cannot pay for it.
- To send children to college. Many parents use the money to ensure the children get a quality education.
- To cover medical care. If you have a sick or disabled family member, the benefits can be used to continue their care.
- To cover everyday living expenses. Some people leave the money in the bank and use it to cover regular expenses. This helps your family maintain the same quality of life they would have if you were still alive.
There are no limits as to what the benefits can be used for, but it is a definite way to protect your family financially in the event of your death.
For more information on life insurance and how it can help your family, Allegiance Insurance Agency is here for you. If you are in or around the Richardson, TX area, stop by or give us a call today.