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Who Needs Life Insurance?

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Are life insurance premiums worth taking out before you hit 50 years-old? Do you need one if you have a family to pay for? If you pass away before your time, will you be leaving a spouse to pay the mortgage? These are questions we don't like to ask ourselves but they're important ones to answer because you could be living without adequate life insurance coverage. The question that people with life coverage don't ask is a simple one: is life insurance worth it? Sometimes insurance gives us peace of mind for things we weren't worried about and should not fear. Is that the case with life insurance?

Is Life Insurance Necessary?

The simple answer here is that if you have a spouse or children or other members of the family relying on you financially, then this type of insurance isn't just necessary, it's essential. When you're not around to earn the lion's share of the money, you need to put in place something that will allow those you leave behind to keep paying the day-to-day bills that cover essentials, childcare and education. Life insurance does that and it doesn't take many dollars out of the family's monthly budget.

No Family

Even if you don't have a family, life insurance may be necessary. It could be used to protect any co-signers from paying the balance of any mortgages, student debts, credit card bills or car loans you would be leaving them with. For most single men and women, life insurance isn't essential. Only when they met someone, get married and have children does the responsibility of their new lives pretty much mandate that they have some form of life insurance in place.

Term Life Insurance

The most basic form of life coverage is term life insurance. This type of policy covers you for a fixed term at a fixed rate. It's the simplest and often the most affordable way of covering yourself. You could take out a policy that covers you while your mortgage is payable or until your children grow up and become adults. The peace of mind this policy offers is almost as important as the money it will provide if the worst happens.

Life Insurance Through Work

Your employer might offer life insurance as one of the benefits of working for them. That's great but it doesn't normally offer enough coverage. If you're married with children, or if you have a big debt like a mortgage, employer-provided coverage won't be enough. You'll get something like two or three times your income, which sounds great but most insurers recommend you take a policy that pays out six to ten times your salary. This coverage ends if you stop working for the company too whereas your own policy will always be in place.

US Government Life Insurance Policy

The US government life insurance policy is the largest in the world as it protects four million Americans. Each person is either an active or retired federal worker who relies on this policy as it also covers their families. Employees pay towards the coverage as two-thirds of the policy's costs are paid out through their wages while the government covers the final third. This insurance can be supplemented with additional premiums attached to the basic premium, but the cost of these optional policies is met in full by the employer.

Senior Citizens

Life insurance when you're a senior citizen isn't as essential as it is through your working life, assuming that you've paid off your mortgage and you have no children to support anymore. Life insurance for those over 65 years old pays out enough to cover the cost of a funeral and other expenses so the payout is often a lot lower than during a person's working life. A person's health is always a consideration when a life insurance policy is looked at by underwriters so the insurance industry has firms dedicated to creating policies for senior citizens because they are more likely to have developed health issues due to their age.