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Tuesday, February 17, 2009

Why A Good Life Insurance Policy Is Necessary To Have

By Chris Channing

Choosing a life insurance plan isn't the easiest of tasks, considering one needs to find a median between immediate cost and cost upon death for descendants. Since it can be hard to find the best cost to benefit ratio, some seem to think it may be easier to do without insurance. On the contrary, however, as there are many expenses to consider.

When one dies, he or she may leave behind certain debts. These debts to be paid will sometimes pass over to the relatives of the deceased, depending on the debt and laws governing it. Tough situations such as trying to handle the mortgage payments of a recently deceased family member can be quite the burden- and may end up in losing a house without financial assistance.

The average funeral just a decade ago, according to reports of a United States statistics gathering entity, was only $5,000. Today the amount can easily surpass $10,000 or more for even a modest funeral. A slightly more chauvenstic funeral will easily cost many times this amount. As such, having life insurance to pay for a proper burial is necessary for a middle class family.

When one passes belongings on, it is subject to tax; depending on what it is. A large piece of property a wealthy land owner might hold, for instance, is going to rack up quite a large number in expenses when it comes time to pay the government. Having life insurance will either pay this amount or help lessen the blow that is left on surviving family members. This applies to other belongings and even cash funds as well.

How much one is going to pay a month is going to be based on their current age, health, and financial status. On average, it would be considered about common to pay around $400 or more each year in life insurance premiums. This amount can be much higher for the elderly, the currently sick, or those who are terminal. When figuring out the cost to benefit ratio of life insurance premiums, consider the length of the coverage and how much payout is to be expected.

Shopping around is actually a very good idea, but not only for life insurance companies. Funeral companies are also in the business to make money, so they will have different rates and services as well. Make a list of businesses in your area, visit each one, and make an educated decision on which to go with.

Final Thoughts

It would be hard to imagine family members struggling to make ends meet because of the expenses a funeral carries. If you'd like to ensure their peace of mind, consider going out and talking to a life insurance representative immediately; it could mean all the difference in case of an accident.

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