Why Life Insurance is the Best Gift You Can Give Your Family this Holiday Season

The holidays remind us of the love we feel for our families. The happy times shared together provide precious memories that can last a lifetime. While we're holiday shopping, life insurance is probably not high on our gift-giving lists, but perhaps it should be. If someone in your life relies on you financially, you need life insurance.

Consider your family's ongoing needs

Think about the ongoing expenses your family will have in the event of your death. Even if they don't keep your home and choose to move to a less-expensive location, they'll still need to pay for food, household bills, mortgage or rent, clothing, and transportation.

Add up your contribution to your family's basic needs each month. Multiply this monthly contribution by the number of months you believe your family will need this financial support. You can use Kanetix.ca's life insurance calculator to determine the amount your family will need in the event of your death.

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Do young adults need life insurance?

The greatest need for life insurance comes when a young family is depending on your income. If you're still building savings, have just begun to pay down a mortgage, and have young children, your family would be financially devastated in the event of your death. Life insurance is important in all phases of life, but young parents with families need insurance coverage most of all.

What type of life insurance should I get?

You have basically two choices for life insurance: term life or permanent insurance. Term life insurance offers you a guaranteed premium with a benefit for a specific policy term (most commonly 10 or 20 years, although other terms may be available). If you continue the policy beyond the term, your premium will be reassessed, and you are likely to receive a higher renewal rate.

Permanent life insurance offers a fixed benefit and a fixed premium. A type of permanent life insurance, whole life, will build a cash value over time as well as pay a benefit in the event of your death. Some whole life policies will also earn interest over time. You can borrow against the cash value of your whole life policy and can also potentially use it as collateral for a loan or mortgage if necessary.

You can also get life insurance for couples, which will provide you with insurance coverage for two people under a single policy. Each partner receives the same coverage. In the event of the death of one or the other half of the couple, the insurance will pay the same benefit. Couple insurance can be more affordable than two separate, individual life insurance policies.

Protect your family first

No one wants to think about their demise but planning for an unforeseen event is part of caring for your family. As you spend time with your family over the holidays, consider the gift you'll be providing to them if something happens to you. You can give them financial security and give yourself peace of mind knowing they'll be financially secure with life insurance. A life insurance policy can be the best gift you can give to your family this holiday season.

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