MONDAY, NOVEMBER 20, 2023
While planning for difficult times may not be the most pleasant way to invest your hard-earned money, doing so responsibly can make all the difference for you and the people you care most about. Losing a loved one can be a traumatic experience that invokes significant anguish, making any additional financial stress particularly difficult. With this in mind, adequate life insurance should be among your family’s top priorities.
How Does Life Insurance Work? 
Life insurance policies establish a contractual agreement between you and your insurance company. You may be able to purchase coverage for yourself and your family members. Depending on the details of your insurance, beneficiaries of a policy can rely on potentially critical funds and resources that may help them financially manage the difficult times following an insured’s passing.
In many cases, the payout provided by life insurance can make all the difference as those left behind attempt to pay for various expenses and losses related to the insured’s death, such as the following:
- Funeral expenses
- Administrative costs
- Outstanding debts
- Estate taxes
- Health care bills
- Lost income
What Are Common Types of Life Insurance?
Life insurance may come in many forms, and deciding which is right for you and your family may require the services of a qualified professional, such as those at Schaffner Insurance Agency. When assessing your coverage options and selecting the right policies, consider the following two primary classifications of life insurance:
- Term life insurance—These policies establish a set period of time during which coverage will be in place. If an insured’s death occurs within that timeframe, beneficiaries may receive a payout to help alleviate the financial ramifications. Term life insurance is generally more affordable than their permanent counterparts. It may be appropriate for parents who want to ensure their children are provided for until a certain age or homeowners with a target date for paying off their mortgage.
- Permanent life insurance—As their name suggests, this type of life insurance provides ongoing coverage throughout an insured’s entire life. As long as policyholders keep up with their premiums, beneficiaries can receive a payout regardless of when the death of an insured occurs. Permanent life insurance policies may also include various financial opportunities, including the ability to accrue cash value over time, which can then be used to reduce premiums or invested in stocks and bonds.
How Much Life Insurance Do I Need?
Your life insurance needs are unique and depend on various factors. For example, younger parents who have dependents or outstanding loans may require more coverage than empty nesters or retirees who may have paid off most of their debts and no longer have others who rely on them financially.
Get the Right Coverage
The dedicated staff at Schaffner Insurance Agency has served families, individuals and businesses in Massachusetts and New Hampshire since 1986 and is well-equipped to help you understand and address your life insurance needs. Visit our website or call 978-851-2727 to get started today.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.
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It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional
in your state. By using this blog site you understand that there is no broker client relationship between
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