Life insurance is a big decision, and one of the biggest questions people have is why they would need life insurance. So let us enlighten you as to the importance of getting life insurance quotes and a life policy.
1. If You're the Main Financial Supporter, You NEED Life Insurance
Let's face facts, if you're the main earner in your family, then should something happen to you, your partner and children, and maybe even your parents or extended family, will most probably suffer financially. One of the biggest reasons that people get life cover is to make sure that there's a financial safety net for their families if something should happen. It's not nice to think about, but ensuring the financial security of people that depend on you is important.
2. If You've Got a Mortgage (or other loans)
Here's one that you might not have thought about: if you've got a mortgage on your house, what happens to your family if something happens to you and there's no one to pay off that loan? Proceeds from a life insurance policy can be used to pay off mortgages and other loans (such as car loans), and some life insurance companies even offer special policies that are designed to cover mortgages and loans. That means that should the worst happen, your house (or car) may be paid off in full.
3. If You're a Caretaker
If you're taking care of a disabled child, or elderly parent or anyone else that may depend on you for day to day activities, then life cover can be essential. A good life insurance policy will make sure that your family member is taken care of if you're not there to do the job, giving both of you peace of mind.
4. If You're Facing Estate Taxes
Estate taxes is the amount of money that the government takes from your assets after death, these are sometimes known as death duties. Depending on the value of your assets, estate taxes can be extremely high, and your family will be responsible for paying these taxes before they can access the rest of your assets. If you're looking at heavy estate taxes, then an extra life insurance policy can be a great way to ensure that both the taxes are paid and that your family are not left in need.
5. If You're an Employer
This is an often overlooked reason for getting life insurance. South Africa is full of small or start up companies, and if you employee others to work for you and something happens to you, your employees may find themselves out of a job. Life cover can help protect not only your family, but also those who work for you, giving them a financial cushion to ease the process of finding new employment. Additionally, if you owe these employees money, they are legally entitled to try reclaim this money from your next of kin who are now placed in your shoes.
6. If You're a Parent
We've already discussed taking care of your family financially, but if you're a parent there's another factor thrown into the mix: the rising cost of education. Many life insurance companies have policies that are specifically designed for children's education, so should something happen to you, at least your kids will still be able get the education that they deserve.
7. If You Might Need Money Later
Something that people often overlook is that a life insurance policy (whole life policies generally- if you don't know the difference between whole life and term life policies, check our life insurance terms and definitions page) can 
be cashed in. That means that if at some point in the future you need cash you can end your policy and get the money that you need. This does mean that you lose a certain amount that you have paid in premiums, but as an emergency fund a life policy can be a life saver. In some cases you may be able to withdraw certain amounts of cash from the policy while still keeping the policy active, though this depends on your life insurance company and the type of policy that you have.
8. If You Need to Borrow Money
Another benefit of a life insurance policy: it can act as collateral for a loan. If at some point you need to borrow money, maybe to buy a house, you can list your life insurance policy as collateral for that loan. Insurance policies are seen as “safe” collateral, meaning that banks are happy to accept them as collateral for your mortgage or car loan, or even a business loan.
9. If You're Worried About Future Medical Costs, Get Life Insurance
Many, though not all, life insurance policies these days contain a clause that allows you to get the full pay out of the policy if you are diagnosed with a terminal disease. This means that you can use your coverage to pay for expensive end of life medical costs and palliative care – giving you comfort and leaving your family without medical debts to pay.
Life cover isn't just a matter of protecting your family in a worst case scenario, though that's obviously important. There are also many other benefits to holding a life insurance policy. And remember, the younger you are, the better your insurance policy will be, with cheaper premiums and better cover. But it's never too late to start!
* Disclaimer: We do not represent any of the companies, products and/or services reviewed, published or advertised on this website. Nor are we financial, health or insurance professionals or services provider. If you request a quote or purchase a product/service, it will not necessarily be given by the company reviewed on any specific page. Any decisions you make based on the information presented is at your own discretion and we advise that before doing so, you consult with the relevant professional.
Main Subject: Life Insurance
