As life is uncertain due to the COVID pandemic, it’s better to prepare and plan for the future. As such, getting life insurance has now become more important than ever.
Unfortunately, about 42 million Americans do not have life insurance, although they need one. Their notions about its value and affordability stop them from getting one. However, these perceptions have somehow changed due to the COVID-19 crisis.
In fact, applications for life insurance have significantly increased during the pandemic. Last year, its application rose to 1.5 percent as compared to the previous year. That said, expect more and more applications to surge due to the threat posed by the COVID-19.
Why you should get a life plan
Let’s first take a look at the practical reasons you should be getting life insurance during this pandemic.
1. It prepares you for life’s uncertainty.
It’s apparent that we now live in an unprecedented time. While global institutions are doing their best to put an end to the COVID-19 pandemic, we don’t know when it will last. Not only does it pose a threat to your health, but it might also cost your life. While you do what it takes to protect your health and life from the novel coronavirus, it’s better to come in prepared for any possibility. Hence, getting insurance can make all the difference.
2. It protects your loved ones.
Getting life insurance is not a selfish move. It isn’t for you; it is primarily for your loved one. In the event of your death, it will protect your loved ones (spouse, children, or other beneficiaries) from financial loss. First, it will cover expenses for the funeral planning and arrangement, burial, and other miscellaneous costs involved. Not only does it cover funeral expenses, but life insurance also does more. It covers your loved ones’ living expenses, housing payments, and even education.
3. It pays off your debts.
Life insurance will take care of your debts in case you die. It pays off your debts such as personal loans, mortgages, and credit cards. The last thing you want to happen is to leave your spouse and children with debts to pay. If you die prematurely, life insurance protects your loved ones from potentially devastating financial losses.
4. It secures your finances.
Financial management is important once you’re alive. It’s important to properly secure your finances and prepare for the future. You don’t want to waste your money and burden your loved ones if you die. Sure, you may put your money into a savings account and invest some to grow your money. But while at it, having life insurance is a vital part of the overall equation in your financial planning and management.
5. It gives you the utmost peace of mind.
As mentioned, life insurance is primarily for your loved ones. However, getting one is also for yourself as taking care of your loved ones will always be your priority. It is, of course, an expression of your love and care for your family. As it will protect them and provide financial relief if your die, you’ll have the utmost peace of mind.
What to consider when getting life insurance
When looking for and getting a life plan, there are a few key factors to consider, as follows:
1. Two Types of Life Insurance
There are two types of life insurance to choose from, as follows:
- Term Life Insurance: This covers you for a set term (a certain amount of time) — thus the name. Common terms are 10, 15, 20, 25, and 30 years. It works the same as other types of insurance. You pay a monthly premium, and it will cover your loved ones in case your die.
- Permanent Insurance: This provides lifelong coverage. This means that it will cover you for life as long as you pay your premium. It is more expensive because of its cash value and benefits. Common types of permanent insurance include whole, universal, burial, and survivor life insurance.
2. Factors affecting Life Insurance
If you’re scouting for life insurance best suited for you, you must consider the following:
- Age: Keep in mind that the younger you are, the less you’ll pay for insurance.
- Health: Most insurers will factor in your past and current health conditions to determine your life expectancy. They will affect your life insurance rates.
- Lifestyle: Of course, you must not neglect your lifestyle. They will determine your finances and how much you can pay for the insurance.
3. Life Insurance Beneficiary
The most important part of your life insurance is your beneficiary. This refers to the person who will claim your death benefit if you die. For the most part, your spouse and children become your primary beneficiaries. However, you can also add contingent beneficiaries.
Securing life insurance has now become more important than ever. It’s vital to get one during this pandemic to plan and prepare for what lies ahead. When scouting for the right insurance, be sure to consider the key factors discussed above. Not only will it protect your loved ones, but it will also give you the utmost peace of mind.
