As the holiday season approaches, many people are busy looking for the perfect gifts to give their friends and loved ones. Stores and websites launch massive sales months before and last-minute holiday madness makes the news every year. This year, however, why not give something more than a gadget from Amazon or a doll from Target? Giving the gift of life insurance is both practical and incredibly valuable.
Why Is Life Insurance So Important?
For your life insurance policy to be valid, you need to pay monthly premiums. Those premiums are determined by insurance underwriters who assess your health, lifestyle, and credit situation. People who pose a small risk of dying early get very low premiums. Those who pose a higher risk get higher premiums.
This is where the gift aspect comes in. Many people don’t get life insurance, not because they don’t recognize its importance, but because they can’t bear the thought of adding another expense to their monthly bills. Others truly can’t afford it. That’s why giving life insurance as a gift is wonderful. It’s not something that lasts for a week, a month, a year. It lasts for many years. Moreover, it gives the receiver peace of mind knowing that their loved ones will be covered in case of a tragedy.
Term and Whole
Many people choose term over whole for the simple reason of affordability. Term life insurance policies usually have lower monthly premiums than the whole. Even though they have an expiration date, they get the job done. People who buy them usually choose a term that will last them until they reach a certain milestone — paying off a mortgage, financing their youngest child’s college education, retiring. They feel that once they pass those specific milestones, they don’t need coverage anymore.
Discuss the Gift Before Giving It
Another reason to discuss it beforehand is that life insurance can be a sensitive subject. Even though it’s the most practical, thoughtful gift, it’s hard for some to face their own mortality. This is especially true if you’re an adult child who wants to buy life insurance for their parents. Though not exactly a taboo subject, it’s important to be sensitive. (Especially if you think you’ll be named as the beneficiary.)