Why Life Insurance Is Extremely Important In A Single-Income Household


If you are the sole-breadwinner in a single income household, it is important to plan how your home will continue running if something unforeseen happens to you. Consider how your loved ones will stay financially afloat if you suddenly pass away or fall terminally ill. You wouldn’t want them to have to struggle to make ends meet. Nor would you want them to be left deprived. A life insurance plan can help you ensure that your family’s needs are covered in your absence. Let’s take a closer look at why life insurance is so important in a single-income household and explore what types of life insurance plans are available.


So, how can a life insurance plan help a single-income household?

A life insurance plan typically pays a lump sum payout if something unforeseen happens to the insured policyholder. The payout is generally made upon death or diagnosis of a terminal illness or total permanent disability. This payout can help the insured individual’s family to cope with the loss of income when the primary breadwinner can no longer provide for them. The payout can help to –

  • Clear any pending dues like loans, credit card bills and so on
  • Pay the home mortgage and avoid foreclosure
  • Afford regular expenses like groceries, utility bills, and so on
  • Pay for any other expenses that may arise
  • Afford medical expenses for the terminally / critically ill family member
  • Pay for funeral expenses
In essence, a life insurance payout can keep the home running even in the most dire circumstances. While nothing can replace the loss of a loved one, having the financial needs taken care of can help to a great extent. As the sole breadwinner in your household, you can have peace of mind knowing that your loved ones will always have a roof over their heads and food on the table if something happens to you.

The beneficiary of a life insurance payout does not need to produce any bills to show the insurer; they can use the money as and how they deem fit.




Looking at the types of life insurance

There are two main types of life insurance plans that you can choose between – whole life insurance and a term plan.  

A whole life insurance plan provides coverage for your entire lifespan. You get covered against death, total permanent disability, terminal illness, and critical illness. On the other hand, a term plan covers you for a certain fixed period as chosen by you when you buy the plan. Term insurance will generally cover you against death, terminal illness, and total permanent disability.

Whole life insurance and term life insurance can both be enhanced with riders for added protection against uncertainties of life. Do make sure to discuss all available rider options with your financial consultant so that you get a plan that offers coverage tailored to your needs.

As we can see, life insurance can provide much-needed financial protection to a single-income household. Do explore life insurance plans and choose the one best suited to your needs.

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