Why Would A Single Person Need Life Insurance?

For married couples with children, the case for life insurance is clear. Life insurance provides a way to ensure that your spouse and children will be taken care of, no matter what happens to you. For single individuals with no children, the need for life insurance may be less clear. But before you dismiss life insurance entirely, consider these reasons for purchasing coverage.

Funerals Are Expensive

Funerals vary in price depending on many factors, such as the type of casket. The average funeral in North America comes with a price tag between $7,000 and $10,000. That’s a lot of money for many people, especially when the death is unexpected, and money hasn’t been set aside. A life insurance policy can cover these costs.

You Have Other Debts

Did your parents cosign on your private student loans? If you were to die before the debt was paid off, your parents could be left with the bill. The same goes for other types of debt, including mortgages, if your parents have helped you out by acting as cosigners.

Debt can also pose a problem if you have an estate that you would want to pass on. The debt will have to be paid by the estate, and this will impact what your beneficiaries receive.

You Want to Lock in Good Rates

Maybe you don’t have a major need for life insurance right now, but you think you will need it in the future. The younger and healthier you are, the better your rates will be. Given this, you could consider purchasing a policy now, while you can still get good rates easily.

Getting good rates will become especially difficult if you develop a health condition. Life insurance companies typically use medical underwriting when making coverage decisions. If you have been previously diagnosed with a health condition – which could be anything from depression to cancer – the insurance company may reject your application or charge you higher rates as a result. You could also be denied coverage or charged more if a genetic test reveals that you have a higher risk for certain health issues. 

You don’t know what the future will hold. Purchasing life insurance now guarantees that you will have coverage as long as you keep up your premium payments.

You’re Interested in Other Aspects of Life Insurance

There are different types of life insurance policies. Broadly speaking, policies can be divided into two main types: term and permanent.

Term life insurance policies last for a set period of time, such as five years, 10 years or 30 years. If the insured dies during this time, the policy pays a death benefit to the beneficiaries.

Permanent life insurance policies do not expire. As long as the policyholder maintains the policy, it is valid until the insured dies. In addition to the death benefit, these policies can also accumulate a cash value, which the policyholder can use to take out loans or to make withdrawals. Some whole life insurance policies also provide annual dividends. 

Different life insurance policies fill different needs. An insurance agent can help you find a policy that meets your needs. Ready to get started? Get a life insurance quote now.

Sources
  • https://www.parting.com/blog/funeral-costs-how-much-does-an-average-funeral-cost/

  • https://www.consumerfinance.gov/ask-cfpb/if-someone-dies-owing-a-debt-does-the-debt-go-away-when-they-die-en-1463/

  • https://www.genome.gov/about-genomics/policy-issues/Genetic-Discrimination

  • https://www.aclu.org/other/summary-laws-regarding-genetic-discrimination

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