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Why is life insurance important? Pros and cons of life insurance

Why is life insurance important

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Why is life insurance important? 

Purchasing life insurance is considered an effective way to protect your family, as it reduces the large financial burdens that may occur in the event of an unexpected event. This insurance also provides financial security that enables the repayment of debts, helps meet living needs, and also contributes to bearing the costs of medical care and expenses. Final.

Most individuals are aware of the major benefits of life insurance, as this type of insurance provides financial security to the family in the event of the unexpected death of the insured, providing them with the reassurance that they are insured that they have the means to endure the financial challenges without it.

Although these benefits generally apply to all forms of life insurance, there are additional benefits depending on the type of policy and level of cover chosen and these include special benefits related to women as well.

The many benefits of life insurance

Life insurance allows you to benefit from various benefits, as it gives you financial comfort regarding the stability of your family in the event of your absence. Although all types of life insurance provide benefits, increasing the level of coverage results in an increase in the benefits that you can provide to your family in need.

Suppose, for example: Some individuals obtain a small amount of life insurance, such as $25,000 through their workplace. Although this amount may seem like a good amount, it may be enough to cover funeral costs and some real estate installments, but with the amount of coverage increasing, Your family can benefit from greater benefits such as:

- Compensate for the income they may lose for several years.

- Pay off mortgages to keep your home.

- Pay off other debts such as car loans and credit cards.

- Save money for your children’s college education.

- Contribute to other obligations, such as supporting elderly parents.

**In addition to the coverage amount, some policies offer additional benefits:

  • Tax benefits, as the death amount is usually considered tax-free, and some policies include features that reduce tax liabilities.
  • A cash value that can be used to pay future premiums or even support life after retirement.
  • Integrating life insurance with other types of protection, such as disability insurance.

Pros and cons of life insurance

Amount of life insurance

Determining the amount of life insurance depends on general rules that take into account your personal needs and circumstances. Individuals often seek to save an amount sufficient to compensate for the loss of income and cover basic costs such as mortgages, especially if they have children to depend on.

Life insurance for the elderly

Life insurance options for seniors vary depending on personal needs. Insurance can become more expensive as they age, but many choose funeral savings policies to ease the burden on their families. Life insurance is also used in estate planning strategies to provide tax benefits.

Taxes on life insurance

In general, life insurance death benefits are not subject to income tax. This means that the family will receive the full amount in the event of need. However, it is preferable to consult a tax professional to obtain more accurate details depending on the individual case.

Get more information

Additional answers about life insurance can be obtained by contacting one of Guardian's financial specialists. They will respond to your individual needs and provide a comprehensive explanation of the available insurance options that suit your situation and budget, all from a company with more than 160 years of experience in protecting families.

Benefit from employment insurance

If you're an employee, benefits you receive at work can be a smart and cost-effective way to gain financial protection. It's best to check your plan details with your human resources department to determine how much insurance is available to you, whether the company offers insurance as a benefit or if you choose to pay for additional insurance through payroll deductions.


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