Why life insurance matters
Life insurance replaces income when someone dies, covering mortgage, education, and ongoing living costs. For business owners it funds buy-sell agreements and key-person protection. The right policy offers peace of mind and financial resilience for dependents.
Common policy types
- Term life: Affordable fixed-term coverage (10–30 years).
- Whole life: Permanent coverage with guaranteed cash value growth.
- Universal life: Flexible premiums and death benefits; cash value linked to interest credits.
How much coverage do you need?
A common rule is 10–15× current income, adjusted for debts, future education costs, and existing savings. For a mortgage, ensure coverage at least equals the outstanding principal plus 5–10 years of living expenses.
Useful riders
- Waiver of premium: Premiums waived if disabled.
- Accelerated death benefit: Access part of benefit for terminal illness.
- Child rider: Limited coverage for children with conversion options.
FAQs
Should young adults buy life insurance?
Often yes: premiums are lower when young and healthy, and term policies can lock in low rates for decades.
Can I convert term to whole?
Many term policies provide conversion options within a period — check the policy terms.