Why Is It Important To Have Life Insurance?
Life insurance is essential as it protects your loved ones from the financial losses that may occur in the event of your death. It ensures financial security, helps to pay off debts, living expenses, and medical or final expenses. A life insurance policy delivers a specified sum of money when you need it. When you pass away, your family will receive the policy payout immediately, which is generally not subject to federal income taxes. Working with a financial professional can make this process easier, as they can help you choose the right type of policy and calculate the amount you need.
Reasons for buying life insurance:
| Reasons | Benefits |
|---|---|
| Tax-free benefit | The benefit of a life insurance policy is generally passed along federal income tax-free. |
| Guaranteed cash value growth | The whole life policy builds cash value that is guaranteed to grow tax-deferred and can help meet a variety of financial goals. |
| Dividend potential | You will be eligible to receive dividends, which can be taken in cash, used to offset premiums, or used to buy additional insurance that increases coverage and cash value. |
| Optional riders | Riders can be used to purchase additional protection without further underwriting, pay premiums if you become disabled, use some of your face amount to pay for chronic illnesses, or purchase coverage for your children. |
The right coverage can offer a valuable combination of benefits, many guaranteed by the claims-paying ability of the insurance company. However, you have to make a long-term commitment to paying premiums and keeping the policy in force.
Life insurance provides lasting peace of mind by providing assurance that you have provided a legacy. It is essential to purchase life insurance when you’re young and healthy as it is the most affordable option. A New York Life financial professional can help determine what’s right for you, and you can contact them through their website or by phone.
