Life/Long Term Disability/Long Term Care
The Role of Insurance in Your Financial Plan
Insurance is an important element of any sound financial plan. Different kinds of insurance help protect you and your loved ones in different ways against the cost of accidents, illness, disability, and death. The insurance decisions you make should be based on your family, age, and economic situation. There are many forms of insurance and, unfortunately, no one-size-fits-all policy.
Life Insurance
Your Needs Dictate the Kind and Level Of Protection. Life insurance, payable when you die, can provide a surviving spouse, children, and other dependents the funds necessary to help maintain their standards of living, can help repay debt, and can help fund education tuition costs. The amount you need depends on your situation.
Value-accumulating whole life or universal insurance is often offered as death benefit protection with a cash value component that you can borrow against or eventually cash in by surrendering the policy. Term insurance costs less, but may remain in effect only for a specified term of years. For many families, a combination of whole life and term insurance may provide for current and future needs.
Disability Insurance
Important Protection if You Cannot Work. When a long-term disability policy is activated, it replaces a portion of your lost income, when you are unable to work for an extended period. Employers cover approximately 40% of all workers with some form of company-paid disability insurance. Generally, you should have total coverage equal to two-thirds of your current pre-tax income.
Long-Term Care Insurance
Don’t Rely Solely On Government Program. With an aging population and uncertainty about the future of Social Security, insurance to cover the high cost of nursing home or at-home health care is the focus of increased concern. Medicare pays very little of the cost of long-term care in the United States.
Because your financial professional understands your needs as well as the role of the various kinds of insurance within an individual financial picture, he or she can help you with the policies that are most appropriate for you. Your financial professional can provide you with costs and complete details.