Is Life Insurance peace of my mind

Life Insurance Equals Peace Of Mind

No one likes to think about the consequences of death and how it affects those that we leave behind. It is however an indisputable fact that sooner or later we will all shuffle off our mortal coils, often without warning. When that time comes a life insurance policy will ensure the financial security of our loved ones in their grief, and will ultimately give each of us the peace of mind that our mortgage is paid off and our families taken care of when we die.

Life insurance these days is in fact fairly cheap to
maintain. Increased competition in the life insurance marketplace, coupled with its ease of purchase over the Internet has bought premiums down to record low levels. You can now obtain a life insurance policy that pays a lump sum of thousands of dollars upon your death for as little as pennies on the dollar.

How Much Insurance Do I Need?

Those that do decide to take the plunge and sign up for a life insurance policy often struggle to decide how much insurance they should take out. As life premiums go up in line with increases in the sum insured, the ultimate insurance amount is often dictated by how much the person taking out the life insurance can afford to pay each month.

Then, there is the thought of the mortgage. If we are still owing money on the mortgage when we depart this world, many of us would not want to see our loved ones struggle to meet the mortgage repayments each month. The amount of insurance taken out therefore should at least cover the cost of our mortgage, or what is left on the mortgage as it would be if a reducing term life product is purchased.

Deciding on the amount of insurance coverage

So, how is it best to decide on the amount of insurance coverage? It varies for each family / individual, but in general you should take out a life insurance policy not only to cover the cost of your mortgage but also to provide your family and dependents with a lump sum after you’ve gone. What lump sum you decide upon will depend on many factors, but it should at least cover the cost of your monthly household expenses minus the mortgage payments.