Life Insurance

Seeking Financial Security? You should get Life Insurance

By August 5, 2022 No Comments

Seeking Financial Security? You should get Life Insurance

Reasons to buy insurance are different for everyone. But the decision to purchase insurance is all about providing financial security for yourself, the ones you care about and business continuation. Learn why life insurance is important, and people who need it.

Why is life insurance important?

Buying life insurance protects your spouse, children and your business from the potentially devastating financial losses that could result if something happened to you or a company/partnership. It provides financial security, helps to pay off debts, helps to pay living expenses, and helps to pay any medical or final expenses.

Life insurance provides cash when you need it most.

Your life insurance policy can deliver a specified sum of money when you need it. Upon your death, your family or business/partnership will receive your policy payout immediately. And that death benefit is generally not subject to federal income taxes. For example, a $500,000 policy provides $500,000 in death benefit proceeds directly to your beneficiary.

Steps in the insurance buying process:

  1. Determine your goals, determine how much insurance you need to meet your goals over time, and determine what you can afford to pay.
  2. Learn what types of insurance can help you meet your needs.
  3. Honest discussion with your business partner and existing family responsibilities and expenses.
  4. After considering initial premium payments, any possible increases in premiums over time, any additional death benefits, and any living benefits that can be utilized before you die, choose the type of insurance policy (or combination of types) that best meets your needs.

Remember, working with a financial professional or financial planner can help make this whole process easier. An experienced professional can help explain the differences between types of policies, help you calculate the amount you need, affordability, and present potential options that may best suit your needs.

6 reasons to buy life insurance.

Life insurance can give you lasting peace of mind in terms of the assurance that you have provided a legacy. That’s because the right coverage can offer a valuable combination of benefits, so that you and your loved ones know exactly what you’re getting. Of course, you have to make a long-term commitment to paying premiums and keeping the policy in force.  Some of the most common reasons for buying life insurance include:

    1. Guaranteed protection

If you have a family, a business, or others who depend on you, the life insurance benefit of a whole life policy acts as a financial safety net. When you die, your beneficiaries will receive a lump-sum payment that is guaranteed to be paid in full (provided all premiums are paid and there are no outstanding loans). It’s essential protection that you can count on to be there for your loved ones when needed.

    2. Income replacement

Imagine what would happen to your family if the income you provided suddenly disappeared. With whole life insurance, you can help make sure that your loved ones have the money they need to help:

  • Pay the mortgage
  • Afford childcare, health care, or other services
  • Cover tuition or other college expenses
  • Eliminate household debt
  • Continuation of business expenses/salaries
  • Preserve a family business from generation to generation
  1. Tax-free benefit

Your beneficiaries will be able to enjoy every penny you leave them. That’s because the benefit of a life insurance policy is generally passed along federal income tax free.

  1. Guaranteed cash value growth

As you pay your premiums, your Whole Life policy builds cash value that is guaranteed to grow tax deferred and can help meet a variety of financial goals:

  • Supplement retirement income
  • Fund a child or grandchild’s education
  • Pay off a mortgage
  • Protect existing assets
  • Provide the basis for a loan guarantee
  • Establish an emergency fund


  1. Dividend potential

One of the benefits of purchasing whole life insurance is that you will be eligible to receive dividends. Although they are not guaranteed, when dividends are awarded, you can take them in cash, use them to offset your premiums, or use them to buy paid-up additional insurance that increases your coverage and cash value, use them to offset your premiums, or take them in cash.

  1. Optional riders

There are several ways to tailor a whole life policy to meet your individual needs. For an additional cost, you can use riders to purchase additional protection without further underwriting, to pay your premiums if you become disabled, to use some of your face amount to pay for chronic illnesses, or to purchase coverage for your children. Your agent can help you decide if any of these riders are right for you.


About CMR | PolicySmart®

PolicySmart’s risk management consultants provide independent group benefit, retirement and commercial insurance advice by reviewing your current portfolio of policies to improve coverage and reduce cost. By using our proprietary database – The CMR Database® (comprising some 13,000 brokers and specialists globally), we maximize access to the insurance and retirement industry providing greater options that will translate to better coverage and lower cost.

Please email or call 888-873-1982 or 212-447-4300 for more information.