Like Timbits, life insurance comes in a variety of options. What do all the types of life insurance have in common? Beneficiaries are paid an amount of money in the event of the policy holder’s death, money that is tax-free in most cases. Life insurance can apply to a variety of situations; it is a way to leave an inheritance for your children, pay off your debts, and give them a better future. Here are 5 great reasons to get life insurance if you have children!

You want to help them start their young adult lives on the right track

As a parent, we would like to be able to do more than just cover our children’s basic needs before they turn 18. For example, can we provide something that they need for their first apartment, or even a little help to pay for their education? Providing support will not be possible if we are no longer around. Unless we have life insurance.

Even if your death does not create any particular financial need for your children, several tens or hundreds of thousands of dollars are rarely unwanted! You should also know that it is possible to decide the age at which they will receive the full amount of your assets, insurance or not. Having an insurance policy and setting an age for the payout will surely put an end to your fears that they will squander the entire legacy by celebrating their 18th birthday on a private island with all of their new friends!

You are in debt

For many of us, a life insurance policy is used to cover a few minor expenses in the event of death. What types of expenses? Your funeral expenses, a tombstone, and your debts like the mortgage on the house or cottage, and the car loan.

The insurance should cover your monthly payments. This includes debts that a spouse, if there is one, would be unable to assume alone if you passed away unexpectedly. This way, your children will be able to continue to live in the same house, in the same neighborhood, in short, to go through this ordeal in the best conditions possible.

You have a child with a disability or special needs

Some children require special care and are unlikely to be able to support themselves as adults. How can they maintain an adequate standard of living once you are gone? An insurance policy could provide a lot of help.

You are an entrepreneur

The case regarding entrepreneurs is slightly more complex and you should seek advice from specialists if you are in this situation. Upon death, entrepreneurs are considered to have sold the shares of their business. Their children or estate, if there are other people involved, would then have to pay capital gains. In this case, life insurance could help cover taxes and would, therefore, be a part of the planning of the company’s legacy to those who will contribute to its survival after your death. If your shares are your main asset, a life insurance could also help distribute your wealth more equitably among several children according to their level of involvement in the business.

You have a lot of taxable assets

Seeing the bills pile up is the last thing they need while grieving! Whether you are a business owner or not, there are several situations that can result in a large amount of taxes to pay after death. However, this is especially true for someone who owns many assets subject to taxation. Life insurance could be part of your estate planning to help pay the bills.

How much does life insurance cost?

Each of these 5 reasons will guide you to a specific life insurance product. Prices will vary as a result of this choice as well as your age, your health condition, your medical history, and several other factors. Of note, one of the types of life insurance is known as term life insurance. As the name suggests, this policy is valid for a specific amount of time. It will not cost you very much if you buy it while still young and healthy. If you pass away while it is in effect, your beneficiaries will get a tidy sum. However, chances are it will end long before you die, in which case you will have paid for peace of mind. Permanent life insurance will not cost you the same price, but it does offer protection without an expiration date. There are also several subtleties in each of these two categories. To get an idea of the prices you could get for your needs, try our life insurance comparison tool.