How Does Life Insurance Protect My Family?

While you may not be able to provide for your family forever, the good news is you can plan to help financially protect them with the purchase of life insurance. If you’re starting a family, this is a great step toward making sure they’re protected if the unexpected happens.

What are the benefits of life insurance and how exactly does life insurance protect your family? Let’s take a look.

Life Insurance Benefits: Financially Protect the Ones You Love

When it comes down to it, the purchase of life insurance isn’t meant for yourself — it’s designed to protect your family and loved ones when you’ve passed away. And if you’re responsible for the financial security of anyone, whether it be a spouse, partner, children, disabled loved one or aging parents, life insurance is an advantageous way to help make sure they are financially taken care of upon your death.

Financial security for your family

Life insurance can help provide peace of mind that your family will have some financial protection upon your passing. The death benefit can provide assistance with things like mortgage payments, care of disabled loved ones and basic needs like food and child care. Ultimately it could allow your loved ones to maintain their current standard of living without worrying about the lost income. Read more about how life insurance works to gain a better understanding of this important coverage.

Coverage for final expenses

The cost of final expenses, things like funeral costs, often amount to thousands of dollars — that’s a hefty out-of-pocket cost that you probably don’t want your family to be troubled with. Life insurance can help pay for things like the burial and funeral service, among other things. Learn more about how life insurance can help with final expenses.

Coverage for the cost of medical bills

If you were to pass away from a health-related issue that racked up a substantial amount of medical bills, life insurance could help your loved ones pay them off.

Cash value component

A cash-value life insurance policy, like American Family’s DreamSecure Whole Life Insurance or DreamSecure Flexible Life Insurance, has a component where you can build up cash value. This is a way that life insurance can help your family financially while you’re still living. Once you’ve built up cash value, you can borrow* against it for things like a down payment on a home, school tuition, investing in a business, etc. — the cash value is available to use as you please. However, if you don’t pay back the loan before you die, the outstanding loan balance plus any unpaid interest will be deducted from your death benefit.

Want to learn more about cash value? Keep reading to better understand the benefits of cash value in life insurance.

What Is the Cost of Life Insurance for Your Family?

Now that you know how life insurance can protect your family by helping to provide financial protection, use our life insurance calculator to get an estimate of the coverage you need for your family. Learn more about how much life insurance you need to see exactly what you should consider when deciding the appropriate coverage amount for your situation.

Choosing a Beneficiary

In order to protect your family with life insurance, you’ll want to make sure you’re naming the appropriate beneficiaries. Typically, a beneficiary is the spouse or partner of the policy holder, but, especially in the case of the elderly, many choose their children as the beneficiary. Think about who will be responsible for your debts, state estate taxes, mortgage or nursing home when choosing a beneficiary. Learn more about choosing a life insurance beneficiary.

Learn More About Protecting Your Family With Life Insurance

Take a look at life insurance from American Family Life Insurance Company to learn more about our coverages. Your agent is a great resource to answer any questions and help you customize coverage to fit your needs. It’s about protecting those who matter most.

*Disclaimer: Any loans taken from your life insurance policy will accrue interest. An outstanding loan balance (loan plus interest) will be deducted from the death benefit at the time of claim or the cash balue at the time of surrender. If the loan balance grows too large for the cash value to support it, the policy could terminate.

Policy Forms: ICC17-225 WL, Policy Form L-225 (ND) WL, Policy Form L-225 WL, Policy FormICC17-225 WL, Policy Form L-226 (ND) WL, Policy Form L-226 WL, Policy Form ICC17-227 WL, Policy Form L-227 (ND) WL, Policy Form L-227 WL, ICC19-97 UL, L-97 UL (ND), L-97 UL (SD)

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Related Topics: Whole Life , Term Life , Buying Life Insurance , Cash Value