What is life insurance? In life insurance, a large number of people (called policy holders) pay some money (premiums) into a fund managed by an insurance company. When someone in that group of people suffers a hardship, he/she is given an amount of money from the fund to help ease the hardship.
Why Do You Need Life Insurance?
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It can help protect your beneficiaries' home and livelihood, help replace your income, and minimize the debt load for you beneficiaries. In addition, proceeds paid to beneficiaries are not subject to income tax.
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To ensure that your immediate family has cash and income after your demise so that they can easily pay bills, taxes, and other obligations.
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To ensure that your immediate family members are able to maintain their standard of living upon your demise.
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For your children to have money for education.
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For you to have a savings plan for the future so that when you retire, you have a constant source of income.
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To ensure that you have extra income when your earnings are reduced due to a serious illness or accident.
Types of Life Insurance: There are generally four types of life insurance available to you :
