Renewable or Convertible Options

When you sign up for coverage, you should also consider making your policy both renewable and covertible.

• Renewable policies allow holders to buy the same amount of coverage when their original plan expires, for a reduced rate and without any health examinations. 
• Convertible ones allow their owners to change over to a more comprehensive, better paying whole life situation, also without medical questions or testing.  This is an important option if you are only buying term because you are desperate to have at least basic coverage and you plan to increase your income and ability to pay more over the years. 

Be sure to question your agent about the variety of beneficial options available to you when you are shopping for new term life. 

The Importance of Coverage for Parents

When you become a parent, one of the first things you learn is that suddenly, a fragile, precious little person is depending on you to meet all of his or her needs.  While that can be as simple as a safe shelter, lots of love, and a warm meal, it can also mean providing comfort and security over a much longer period of time.    One of the ways you can do that is by investing in a quality life insurance policy.  In fact, when you think about the peace of mind you get when you make such a purchase, it may be the best thing you can do for your growing family.

Working Parents

Clearly, employed parents who are paying the majority of the family's bills and expenses are vital to insure.  The death of a working parent – especially if he or she is the primary breadwinner – can be financially devastating to the surviving spouse and children.  Losing that source of income can eventually result in foreclosure of the family home, and a drastically reduced standard of living for the surviving children and spouse. 

Life insurance for a working parent should be calculated to cover your spouse and children's annual expenses (paying the mortgage or rent, utilities, clothing, food, entertainment, activities, and other costs), in addition to anticipated funeral expenses.  You will also want to continue long-term expenses like college education for your kids, and the age at which your spouse intends to retire. 

Finally, factor in other investments and savings that you may have, as well as social security benefits.  Many people are over-insured, but it is very important to make sure you have enough coverage.

Stay-at-Home Parents

Although it seems almost contradictory, a decent insurance policy is also a good idea for parents who stay at home to care for their children.  Stay at home moms and dads may not “bring home the bacon,” but they do make huge contributions to their households.  They provide child-care for young children, rides to and from activities for older ones, cooking and cleaning services, and often run errands to keep their homes running smoothly (and help their spouses out as well).  While a SAHM or SAHD does these things for free, in his or her absence, someone else may be paid for childcare and other household needs.  His or her life insurance coverage does not need to be as significant as the breadwinner's, but it should still be sizable enough to help the family at least until all the children are old enough to stay home alone while the other parent is working.

Ultimately, insurance is designed to keep your loved ones comfortable in the event of your passing.  Losing a parent is difficult enough without adding financial hardships, so take care to make sure you have the coverage you need to maintain or improve their standard of living.  Our company can help you make the appropriate calculations and find an affordable policy that will meet your needs.  

Second-to-Die Coverage

Another option for married couples is to purchase survivorship insurance, also known as joint & survivor or second to die.  These forms of coverage insure both spouses together, and beneficiaries only receive payment when both have passed on.  Second-to-Die is an inexpensive, very affordable type of policy. 

Wealthier individuals often choose these to cover estate taxes and other end of life expenses so that their survivors and loved ones are not penalized with heavy taxes (and therefore, losses) and can maximize their inheritance. 

Survivorship policies can also be useful for parents wishing to protect their children and leave them enough money to get through college and other life events, into adulthood.  Trusts can be established for this purpose, using either a professional or an adult guardian to monitor and regulate spending. 

Coverage Options for Spouses

Married couples have different life insurance needs than single, divorced, or already widowed individuals.  It makes sense for both partners to have coverage, but that can be structured in various ways.

Individual Policies

Purchasing separate ones for each spouse is a fairly typical way to go.  This means that both individuals have the ability to add inexpensive riders on, pay premiums based on their ages, health, weight, and smoking status, and also to make sure they have a benefit that will pay for their end of life expenses as well as providing their beneficiaries with necessary (or generous) funds.  If purchased together through the same company or using the same agent, the couple should be able to get a discounted premium rate; insurers value customer loyalty and would be likely to reward it.

Purchasing separately is also a wise choice – and sometimes the only choice – for couples who are living together but not married.  Legal marriage is required for most spouse riders.