If your spouse or partner dies you would have lots of issues to deal with including the financial impact of your loss. If you have spouse life insurance you know that in such difficult circumstances you will have a financial cushion to help you respond to such a big change in your life. How important is that kind of peace of mind to you?
Will you need additional funds if your spouse dies?
When thinking about whether you need a spouse life policy consider the following scenarios. Scenario 1,John is married with 3 children under 15 with a stay at home wife. Scenario 2, Cheryl is a stay at home mum who looks after the children and keeps the home running smoothly so Sam her husband can concentrate on his business. What will be the impact on these families if John or Cheryl dies?
The point of life insurance is to make a death benefit available if the policy owner dies. If the beneficiary of a policy is in their late 80's that death benefit is of course useful for a number of reasons. If however a young breadwinner dies the needs of his or her surviving family are immediate and dire.
If a breadwinner dies and he leaves a wife and children a spouse life policy payout can cover funeral costs, provide money to substitute for his income and to cover educational expenses. If a wife dies her husband then has the responsibility of earning a living and also looking after children. In those circumstances a spouse life policy may cover child minding and housekeeping expenses.
Will term or whole life spouse life insurance work best for you?
What type of spouse life policy you take out can vary depending on your need and circumstances. If you need to keep premiums as low as possible then a term spouse life insurance policy would be best. Term polices are normally for a specific period of time and the costs are lower than whole life insurance. In this case it would be during the time of maximum financial vulnerability for the family if a husband or a wife dies. With a term policy, if a spouse dies then the remaining spouse only receives a death benefit and not the value of the premiums that have been paid.
Whole life spouse life insurance is an alternative to a term spouse life policy. Whole life policies are more expensive but the value of the premiums accrues. This means that if a policy owner dies the beneficiary gets not only the death benefit but also the value of the premiums less insurance costs.
Depending on the circumstances of the family it may be prudent to consider carrying spouse life insurance on both a husband and wife. In a marriage a husband and wife operate as a partnership in maintaining the family unit. Either will be missed if one dies but what will be the financial impact of the death of one rather than the other?
As with all insurance you need to get a quote from a reputable insurance firm so you can make up your mind if this type of policy will meet your needs. Gather as much information as you can and ask questions of the insurance company you get your quote from. They will be as eager to meet your needs as you will be to make sure you get a good deal.
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