Life Insurance Blog

Life insurance policies are often seen as being practical only with regard to the death benefit received upon the passing of the insured. But life insurance can have other uses outside of the standard death benefit payout. Below is a list of some of the extra features of life insurance that policy holders can take advantage of.

• Disability to the policy holder. There can be times in the life of a policy holder when they are injured and cannot work or otherwise function as they normally would. Their employer may cover them under disability insurance or another form of temporary disability coverage, especially if their injuries occurred at their place of employment whilst performing job-related duties. However, sometimes these injuries occur outside of one’s job, leaving the policy holder wondering how they are going to pay their utilities or meet their monthly mortgage obligations. This situation can become especially dire if the policy holder has no disability coverage through their employer. To be prepared for situations like these, it would be wise for policy holders to consider switching to a life insurance policy that carries the additional cover of a disability payout. As with any life insurance cover, there are restrictions that apply and the policy holder must meet certain minimums, but otherwise it can be a great boon to the insured’s peace of mind, not to mention their wallet. Disability payouts are often deducted as a percentage of the guaranteed death benefit.
• Injury to the policy holder’s loved ones. But what if the injury does not occur to the policy holder? What if an injury strikes someone in their family, a spouse or a dependent under their care? Injuries to loved ones, such as these, will still obviously affect the policy holder and their ability to make their repayments. It can be tough to pay the bills and the daily costs of living without a mortgage or home loan, but with such high-cost expenses in a policy holder’s monthly budget it can become increasingly difficult to pay for someone else’s medical bills and rehabilitation. Certain life insurance providers understand just how hard it can be and have built covers that can assist policy holders with injuries or disabilities that affect their income and/or household. As usual, there are qualifications that must be met.
• Education fund for the policy holder’s dependents. Most life insurance policy holders understand that the death benefit payouts that are disbursed amongst their beneficiaries can be used toward any number of needed expenses. Paying off medical bills, funeral costs, burial fees, home loans and other similar obligations associated with the deceased are typical uses of the death benefit once the policy holder is gone. Whatever money is left over can then be applied as the beneficiaries see fit, including contributing towards things like education costs. But there is no need for the policy holder to rely on the death benefit alone to fund their dependents’ education. Some insurance providers offer a cover that will assign a certain amount of money to be held in an education fund that can later be redeemed. The great thing about these products is that they can be accessed even while the policy holder is still alive. In this way, policy holders can make their policies work for them and their family in advance of the actual death benefit. Rules and restrictions are in place that both policy holder and the intended recipient must meet, but generally this coverage is a very open one that all families should consider.