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August 5, 2014

The Basics About Life Insurance

Pregnant CoupleFiguring out life insurance can be exhausting and confusing for someone just starting to think about applying for coverage. Life insurance comes in a variety of forms and covers a wide range of issues. Different people in various situations need diverse types of life insurance, so it is very important to understand everything you can about what life insurance is and how it works.

Most people understand that at the base level, life insurance can provide a cash payment to your living heirs if you die. Life insurance is not considered normal income, therefore it is not subject to income tax and is used as needed to pay for your funeral costs and provide for your family. How much life insurance you need will vary depending upon your circumstances; happily, there is a range of policies to meet your present and upcoming needs. Life insurance requirements will increase as you age and then decrease in your senior years for a large amount of people. When you are young and just starting out, you often only have yourself to worry about. As you age, you gain a family to provide for. Once your children grow up and move out, your life insurance needs are reduced with less people to provide for once you pass away.


If you are single, you may feel that there is no reason to have life insurance, since you will leave no dependents behind when you die. However, although no one is depending on your income besides yourself, there are other important reasons to have a basic life insurance policy. You can become ill at any age with a serious life-threatening ailment that may diminish your savings account, not leaving enough for funeral expenses, if they are needed. If you cannot cover your funeral expenses, this can cause a hardship on your remaining family — often siblings or parents, who will be stuck covering the costs. Additionally, a bonus benefit of purchasing life insurance when you are young and single is getting an enhanced policy at a less pricey rate than you’d pay if you purchased it when you were older.


Getting married increases the amount of life insurance you will want. Beyond covering your funeral costs and other expenses, you will want enough coverage to help provide for your spouse. Besides handling your death, your spouse may need help covering obligations such as credit card debt, mortgage payments and medical expenses.

Married with Children

Once you have children, you will feel the need to increase your life insurance policy even more. Your life insurance policy should ensure that your entire family’s future needs are provided for in the event that you cannot be there to support them. This will mean an increase to help cover their upbringing and future education expenses; you may want to significantly raise your life insurance policy if you want your spouse to be a homemaker until the children are grown.


You work hard all your life to achieve a comfortable retirement. Often by this time, your children are done with school, they are moved out and your mortgage may even be paid off. Once you retire you may want to reduce the amount of life insurance coverage you have, unless you plan on supplementing your spouse’s retirement or helping your grandchildren through school. However, if you do choose the route of lowering your life insurance policy, keep in mind that you still need enough to cover any medical debt you may have, along with funeral expenses. You might also want to leave your spouse enough to give them peace of mind about future financial problems.

Interested in learning more? Call Cloverleaf Insurance at (636) 928-1373 for more information on Missouri life insurance.

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