Life insurance is an important part of an individual's investment portfolio, not necessarily to create wealth, but to have financial security. Have you ever thought how it would be if you never made it home from work today? Or if some untoward happens to you, would your family be able to continue to live in the same house? Sit back and spend some time to think how you can provide for your family all that you wish for even after you have left them.

This is where a good and appropriate life insurance comes into play. Through a correct policy, you can give your loved ones every little thing they deserve even when you are not around. Insurance makes you sure that your family is protected.

In order to ensure the standard of living is not compromised in case of any mortal eventuality to the sole breadwinner of a household, it becomes necessary to look for insurance and invests in properly sized products. Other than that, when you opt for a life insurance policy you enjoy other benefits also, like tax-deduction options, and in some cases long-term capital gains.

To have a good life insurance cover is important at every step of life, especially when you are the only one who brings home the bacon. In the recent times, life insurance policies have undergone many positive developments. Now, it helps in paying all of the following when an insured dies:

€ Replace a wage earner's income
€ Pay for a housekeeper
€ Pay off bills (mortgage, credit cards, car notes, etc.)
€ Pay for children's college
€ Pay for daughter's wedding
€ Buy out business partners
€ Pay for funeral costs
€ Pay off final medical expenses

The primary objective of an insurance cover is to secure your family and those who are dependent on you. When you decide to invest in life insurance, it is imperative that you understand your financial status, future liabilities and commitments, and then opt for a policy that would suit your needs in the longer run.

In general, there are a number of insurance products to choose from, such as whole life, term insurance, endowment policy, etc. Whole life insurance policy covers the insured for their whole life while simultaneously building cash value. The advantage that an individual gets when he/she opts for a whole life policy is that the validity of this life insurance policy is not defined and hence the individual enjoys the life cover throughout his/her life.

A term insurance covers the insured for a specific period of time. Here, the premiums are a fixed rate. In such type of life insurance policy, a fixed sum of money called the sum assured is paid to the beneficiaries if the policyholder dies within the policy term.

Policyholders benefit in two ways from a pure endowment insurance policy. In case of death during the tenure, the beneficiary gets the sum assured. If the individual survives the policy tenure, he gets back the premiums paid with other investment returns and benefits like bonuses. Apart from these products, there are other types of insurance covers also which offer different benefits.

It is advisable to refer to some reliable sources like an independent insurance broker, your friends, older family members & Internet before you go ahead with a particular insurance cover. Few other set of factors, which need your attention is analysis of different categories of insurance, conduct a proper market research and check your financial constraints where you ensure that you pay your insurance premiums simultaneously.

A correct policy serves many practical purposes, so why not consider it an act of love and kindness that you can perform for people who matter the most to you. Those who do not have proper amount of coverage they would need in a couple of years down the line should now, make the right move and choose a suitable life insurance policy.

Disclaimer:

1. Views as are mentioned in the article are personal views of Author and nothing to link with Co., its Director and Employees.
2. All investments are subject to market risk and you need to consult your financial advisor/consultant before investment.