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Determining whether Life Insurance is right for you

By Compuquotes Team on March 26th, 2008

While life insurance can be very useful in covering expenses and providing for your family after you pass away, it is by no means right for everyone. Not everyone is going to have the family obligations and debts to necessitate life insurance, and many people may simply not be able to afford it. If you aren't sure whether it would be in your best interest to take out a life insurance policy, then consider the following information and see if it would help you. This will not only help you to decide to get life insurance if you need it, but it will also keep you from buying an expensive life insurance policy if you don't need it.

Family life

One of the primary reasons that people buy life insurance is so that it can provide for their spouse and children if they pass away unexpectedly. If you are unmarried and have no children, however, this obviously isn't going to be a very compelling reason to buy. Keep in mind that life insurance can be used to provide for others that you care about as well, including nieces, nephews, godchildren, siblings, or even close friends in most cases. Look at your immediate family as well as your extended family and social circle and determine whether there is anyone that you would want to make sure was taken care of should you pass away.

Debt

Another major use of life insurance is to pay off mortgages or other large purchases in case you don't survive to pay off the total debt. This can remove a major financial burden from family and friends, but if you don't own property or have outstanding debt then it isn't a very compelling argument for buying life insurance. Sit down with your finances and determine whether you have any debts that your survivors wouldn't be able to cover with the money that you leave behind. You don't want to be a financial strain on family and friends, but you also shouldn't buy a large life insurance policy if you feel that you have no need to.

Funeral expenses

Funerals can be expensive, and that is yet another reason that many people choose to buy life insurance. The rising cost of funeral services can create an immense financial strain on those who have to pay for them, and can be a compelling argument for having at least a small life insurance policy to cover those costs. Even if you don't choose to take out life insurance, you should at least take the time to investigate other options so that at least a portion of your funeral costs will be covered.

Financial concerns

Obviously, one major concern when it comes to whether you should buy life insurance is whether or not you can afford it. If you determine that life insurance wouldn't benefit you that well then it's obviously not going to be a big deal if you can't afford it, but if it would be good for your family then not having the money can be a problem. Taking the time to shop around for quotes on different life insurance policies can help you to determine whether at least minimal life coverage is affordable, and will give you a broader perspective of what all life insurance can offer to you.

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