When things are going well, none of us like to consider the 'rainy days' -- And who can blame us? Having to consider what might happen to your house, family or other assets should you be unable to work for an extended (or possibly permanent) period of time, or how the family would cope should you pass away is not the sort of thought that most of would like to entertain; However, in today's world this is a possibility that we all must consider, and the best way to cover your family financially is through taking out some form of life (or 'term') insurance. There are a few different types of cover available, and each should be considered carefully before making an application.
Life Insurance is pretty straightforward; in the event of your death, this insurance provides a lump sum to your named beneficiaries to settle your accounts and provide for a funeral, and often leaves an amount left over to provide income for the family moving on from the event. Even if you have no dependants, you should consider outstanding payments such as mortgages -- these will need to be paid in the event of your passing.
Total and Permanent Disability Cover covers you against not only death, but furthermore, should you develop an illness or receive an injury which stops you from being able to provide for dependants -- usually taken out alongside life insurance, and for the same amount.
Income Protection is not strictly a form of life insurance, but is quite often taken out with a form of life cover -- hence it's inclusion. This protection covers you if you are unable to work for a period of time through illness or temporary disability, this is paid as a monthly payment to you.
Critical Illness Cover protects pays out, should you suffer one of an array of "incurable" conditions. Trauma cover varies from income protection because it is not based on your ability to work: Critical Illness Cover will pay out on the initial diagnosis of one of the conditions specified in your policy wording.
Terminal Illness Cover offers you the opportunity to claim an amount of your sum assured on diagnosis of a terminal illness, this money is yours to spend as you see fit. This option can alleviate a lot of strain and stress from your family, as they will have less to consider in the event of your death.
Those who are past retirement age should also consider whole-of-life (or permanent) term insurance - Rather than the policy only running for a fixed number of years (i.e. Until you retire or your children have left education), a whole of life policy will run until the day of your passing, at which point it provides a sum to the beneficiaries in the same way a normal life insurance policy would.
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