Why should you own life insurance?

The most interesting word above is own.  That is because in 1913 the Supreme Court ruled that life insurance is property.  It is owned by the purchaser and is a unilateral contract.  If you are truthful on the application and the policy is issued, the insurance company cannot change any of the terms or conditions in your contract without your consent. It is a very important part of your financial assets.

1. The most common reason for life insurance is to provide a sum of money in the event of a premature death of the insured.  Many people own life insurance to:

•  pay off a mortgage or other property loans
  
•  replace the income of the deceased
•  cover expenses for child care
  
•  pay for education expenses for children
  
•  or any of your own reasons (Why not write them on a piece of paper?)
  

Life insurance is a unique form of property that springs into life at a critical time due to an untimely death, providing tax-free money to cover any or all of the expenses listed above.

2. One important and overlooked value and use for life insurance occurs after retirement.  Life insurance proceeds can help the surviving spouse to replace Social Security income that is lost on the death of the first spouse. Given that for a majority of Americans, Social Security makes up a large amount of their retirement income, the proceeds of a life insurance could be the difference between a comfortable life and one of isolation trying to make ends meet. 

3. What kind/type of life insurance should you own?  Term insurance can provide coverage for a specified number of years to pay off certain debts that will end at a point in the future.  Lets look at it like a mortgage. You pay a little payment each month for the big payoff at the end.  But unlike a mortgage that requires you to complete the total payments before the reward, a term (or other type of coverage) life insurance policy self completes at your untimely death and can pay off the mortgage.  However, if you are financially able to purchase a permanent, cash value life insurance policy and the devastating event does not occur, you could have a substantial amount of cash value in the policy that could be available for use in retirement.*

Thomas F. Kistner and/or National Associates, Inc. of Texas are not affiliated with or endorsed by the Social Security Administration or any other government agency.  Guarantees are based upon the claims paying ability of the issuing insurance company.

  
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