5 Surprising Benefits of Enrolling in a Life Insurance Policy
Most people know that a life insurance policy will provide a cash payout, or “death benefit”, to your designated beneficiaries after you pass away. They can then use that money to pay for your final expenses and provide necessary cash flow in the absence of your income. That’s the primary purpose of a life insurance policy, after all. But you might be surprised to learn that life insurance can carry several other important benefits, depending upon the type of policy that you choose.
Fund an emergency or major life expense. Some types of life insurance build cash value, and you can either borrow against it or outright withdraw the funds if needed. Use the money to pay for an emergency or major life expense, or even to fund your retirement.
Access part of your death benefit while you’re still living. In the event that you develop certain chronic or disabling conditions, you might need access to cash for living expenses while you’re still alive. If you’ve elected a certain “rider”, or clause in your life insurance policy, you can access part of your death benefit during this time. This benefit can be invaluable to your family at an otherwise difficult time.
Carry out your legacy. If you have big dreams of a legacy you wish to leave behind you, a life insurance policy can help you accomplish that goal. The funds can be used to set up a college fund for children or grandchildren, give a gift to your favorite charity, or otherwise accomplish some major goal.
Hedge against taxes. Death benefit payouts don’t count as taxable income, so you can leave behind assets to family that will not be a burden on them. And in some cases, a loan taken against your cash value life insurance policy can be non-taxable as well.
Provide continuation for your business. Each partner of a business should carry a life insurance policy that provides for the transfer of ownership in the event of their death. This way, the other owners don’t have to worry about a potentially devastating interruption and rearrangement of the business if the worst happens.
Of course, each life insurance policy differs slightly from others. To find your best fit, work with one of our life insurance specialists who can take note of your needs and priorities, and guide you toward the type of policy that best suits your situation.
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