Insurance of any kind provides extra cover and protection to the holders in their hour of need, especially life insurance covers. It ensures a financial shield against unfortunate events or circumstances in life. The biggest hit after a man or family head death is borne by the spouse and the children, life insurance in these sudden or unpredicted circumstances is beneficial.

Most people neglect that life insurance is not expensive; many think they have to pay $1000 annually, whereas you can get life insurance as low as $170. A small price contributes a lot in the hour of need for your loved ones.

Life Insurance Benefits:

The benefits of life insurance are enormous; it depends on the coverage amount; a larger amount reaps more benefits to a family than normal or general life insurance. But the main purpose of life insurance remains the same it gives your family financial coverage or confidence that your family will have in your absence.

The more you avail of the add-ons or a larger amount of insurance, the more your family will benefit from it. To understand it let's take an example: Generally, most people have workplace life insurance with a nominal amount, let's say $25000; although the amount looks great but in reality, with this amount, a family can't take much benefit, they can make good arrangements for the funeral and pay few mortgage payments.

But if the life insurance coverage amount is larger or higher than several benefits and chances of more financial stability also increase, the following are some of the benefits:

• Income Replacement: A good and large sum of life insurance acts as an income replacement; it pays and accounts for years of lost salary.
• Home Mortgage: The benefactor of the life insurance can pay the home mortgage; good life insurance covers mortgage payments too.
• Debt Payments: Debt payments like credit, car and student loans can also be covered in life insurance, but it all depends on the sum assured or life insurance of a larger amount.
• Kids' Education and Care for Elderly: Kids' education and care for the elderly come by availing different options under life insurance.

Apart from these benefits, life insurance also provides other benefits, which help cover more aspects of life and safeguard life insurance.

Tax benefits or Advantages:

Life insurance payouts are not liable to taxes; if the insurance holder dies during the insurance coverage period or when it is in effect, the life insurance beneficiaries will benefit in a lump sum amount as a death benefit. These amounts or amounts that beneficiaries get against life insurance are not considered income and are exempted from taxes. Beneficiaries don't have to include or report them in their tax returns.

Don't Worry About Living Expenses:

According to some experts, if life insurance is 7 to 10 times the annual income of the holder, then the beneficiaries don't have to worry about their living expenses; a larger insurance amount not covers their living expenses but also pays for the children college education, they don't have to take to any student loans.

Coverage for Terminal Illness:

Life insurance can act as a savior for someone diagnosed with a terminal illness, but not all life insurance companies offer life insurance providers that facility. Few companies or life insurances offer riders (endorsements or special offers) that allows or give permission to use your life insurance money before death under some conditions or circumstances; terminal illness is one of them. So technically, life insurance money can be used to pay your hospital bill and other expenses for a speedy recovery.

Retirement Benefits:

Some types of life insurance policies can accumulate cash value over time. That cash value builds over time that can be used to pay premiums or cover expenses, such as paying a down payment for the house or buying the car. Most importantly, you can also tap into it during your retirement years and benefit from it.

Types of Life Insurances and Their Benefits:

There are two types of life insurance:

• Term life insurance: The term insurance as cleared from the name spans a specific term or period; for example, a term life insurance of 10 years means, if something happened during these years, then the holder's beneficiaries get something if the term gets over's and nothing unfortunate happens then the holder has to renew it.
• Permanent insurance: Permanent insurance, also known as whole life insurance, covers the entire life; both of these insurances have unique benefits that can be avail.

Benefits of Term life insurance:

• As valid for a specific term or time, these life insurance costs are low.
• It's simple and easy to understand.
• Depending on the company's policy and provisions, anyone with this insurance can convert it into whole life insurance.
• If you cannot pay it or can't afford it anymore, you can take it without losing anything, as premiums are already paid.

Benefits of Whole Life Insurance:

• It provides permanent life insurance that covers the entire life.
• Cash value is offered in permanent life insurance that a policyholder can use or borrow an amount against it.
• Tax advantages are those benefits in estate planning.

Final Thoughts:

Life insurance protects one's beneficiaries from financial un-stability and unfortunate circumstances that loved ones face after the sudden unfortunate death of their head of the family. There are two major life insurances; both have their benefits.

If you are planning to buy one, inquire about the benefits and amount required. You can also add riders to make it more beneficial and covers more aspects.