Why Do I Need Life Insurance and Types of Life Insurance (Part 2)

Hope everyone had a great weekend! I was busy the whole entire week due to my trip to Sri Lanka taking care of another business. Well, let's pick up from where we left off.

From the previous post, I talk about the reasons why we need life insurance and recommended a few policies that may cater to your needs.

Did I mention that my wife and I were newly weds and tied the knot in 2016, however, like most married couples these days, our process was to get our BTO first, get solemnised and then, had our wedding ceremony on May 2018. Back then, we were talking about the insurance policies we each own and how we should nominate, however, we realised that our parents didn't get us any life insurance policies. In a way, we will not be able to leave our legacy for our future children nor will we be able to provide any sense of financial security if either of us reach the end of our journey. Somehow, we can honour our vows of taking care of each other till the end of their lives by having a life insurance policy.

Here's a few other reasons why life insurance is indispensable.

6. Leaving an Inheritance

As mentioned, a fraction of the reasons why I would want to get my wife and I a life insurance policy was to leave our legacy to our future children. Even if I don't have any fixed or monetary assets to pass to my heirs, I can leave an inheritance by buying a life insurance policy and naming them as beneficiaries. In a way, an awesome way to ensure that my kids will be guaranteed a solid financial future and be provided for any necessary monetary needs that will arise.

7. Pay off Mortgage

Protecting a family means providing a roof over their heads. If I am gone early, my wife may struggle to continue settling our mortgage loan. By purchasing a term life insurance, your loved ones will receive the face value of the policy when inforced. They can use the proceeds to pay off the mortgage.

8. Take care of Business

As a financial advisor and also a business owner, I realised that Life Insurance isn’t just for individuals. It can protect a business from financial loss, liabilities or instability in the case of the death of a business owner or business partner. It can help sustain the ongoing business and provide necessary monetary support for the business till the handover or till someone takes over. It is also recommended to insure your business partner, so that you can buy over his or her shares if anything were to happen to your partner. As it took hard work and patience to get the business up and running, it will be a pity to sell the company.

9. To be Safe than Sorry

In case of developing a serious illness or terminal illness, this can help you with financial support. It may not be able to get life insurance to the extent you need it — or at all, however, Life insurance can also be used in case of emergencies so as to request for a lump sum withdrawal upon doctor's diagnosis and endorsement.

10. Additional Reason: Long Term Care for Special Needs Children

This may not apply to everyone, but I do have clients and friends with special needs children, and this is a very common question I face often. Apart from accident and savings plan, It is difficult to get these children to get insured, therefore, it is considerable for parents to get a large life insurance policy if your income is needed to support dependents long after your working life, especially for special needs children who are not able to support themselves. In this case, whole life insurance policy is recommended over a term life policy, since the coverage may be needed to support a future generation.

So this sums up the benefits of having a life insurance and the types of insurance that you can consider. I hope this gets you think about how much life insurance and need and you to get a quote or two to compare. It's not as costly as you think versus the reasons I have listed. if you have any doubts or enquiry, don't hesitate to contact us or email me!

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