Many will agree that life insurance is the possibly the best device ever invented for the purpose of family protection. For a young couple, the breadwinner will not be able to save fast enough the amount he required to guarantee his family the lifestyle he desires for them should any misfortune befell him prematurely. The cost of daily living is unavoidable. There is a cost to every hour that an individual spends on earth. Hence, the most important of the many benefits of life insurance is the concept of life insurance as a device for family protection. The breadwinner is therefore able to ensure continuous provision for the daily expenses of his family in the event that he dies prematurely.
Besides the above, the other important benefits may be listed and summarized as follows:-
1. Retirement Income Fund – endowment and investment linked insurance policies are rather popular due to the savings element in these types of policies. The expenses of living in retirement can never be escaped. If insufficient funds are not provided for, the individual will face the prospect of laboring into their old age and n the worse scenario, may need to experience the anguish of seeking charity in the form of public assistance, or dependence upon one’s own children. Many a time, heartrending stories of abandoned old folks are found in the media. Hence, saving for the future through a life policy to save for retirement when the maturing policy is redeemed is another popular concept of life insurance. The benefit is that the fund originally intended for family protection will be your retirement income fund.
2. Educational Fund - The cost of an education is ever increasing and the expenses to provide for the children tertiary education are unavoidable. One may obtain a loan when the time comes for the child to attend college and pay back in installments when the child finished college. A far better concept would be to look ahead and pay in advanced the installments into a fund. The benefit is that a fund is already created to cater for the child’s education, whatever happens tomorrow.
3. The Last Expense Fund & a Fund for Estate Duties - doctor’s bills, hospital bills, funeral expenses, lawyer’s fees for the administration of the deceased’s will and estate, etc. are inevitable expenses and obligations faced by the deceased’s surviving family members. It may be argued that one just need to set aside an amount be it two thousand dollars or twenty thousand to meet these expenses. But isn’t it simpler and sounder to set aside just 2 % to 3% of this amount each year to an insurance policy for the next 40 to 50 years for the costs to be paid in full? After all, like they say, death is a sure certainty, may it be tomorrow or 50 years from now.
To sum it all up, the terms of life are hard and the business of life imposes certain costs of which there is no escape. The benefits of life insurance therefore include the provision of protection to one’s family especially at the early stage of family life, the obligation for the costly tertiary education for one’s children, forced savings for one’s own retirement and avoid burdening one’s family of the inevitable last expenses one required when they leave this world. Hence, indeed, the benefits of life insurance and the understanding of its concepts are too wide reaching to be ignored.