Congratulations! You’ve done it! You have brought new life into the world. You are now a parent, with all the overwhelming challenges that come with raising a baby. Your responsibilities have multiplied beyond measure. Dirty diapers, hungry little tummies, baby proofing the crib… it is hard to keep up. You want the best for your precious little one. You no doubt want to protect them and their future. It is time to get life insurance.
For many adults, having a child is the moment they realize the importance of obtaining a life insurance policy. Having life insurance is vital for providing your child with the financial means to grow and flourish in the event of a parent’s untimely death. It is important to understand what is life insurance and what it can and cannot do.
What is life insurance, exactly? Just like it sounds, life insurance distributes money to beneficiaries in the event that the policyholder dies. Life insurance can be purchased through an insurance agent. The three most common types of life insurance are term life insurance, whole life insurance, and universal life insurance.
Term life refers to insurance that covers a designated period of time, referred to as a term, and is generally a more affordable option when choosing coverage. For example, a term policy might last one year, five years, ten years, or more. The term policy might also terminate at a certain age such as 75 or 100.
Whole life refers to insurance that covers the policyholder for life. The cost for this type of coverage tends to be higher than that of term life insurance. That said, as long as the insured pays their premium, whole life insurance can provide long-lasting coverage. and significant peace of mind.
Universal life is similar to whole life, but the premiums vary over time. There are additional benefits to a universal life policy, but it is important to note that as the policyholder ages, he or she must gradually increase premium payments. Failing to do so can result in diminishing benefits and, ultimately, the loss of one’s policy.
If you, the policyholder, is the primary income winner in the family, life insurance will see that your income is replaced with non-taxable death benefits. 
For example, if you have term life insurance, your beneficiaries will receive fixed payments. This will greatly ease the financial burden on your family. Life insurance can make certain that after you are gone, your children can pay for school, your spouse can pay their mortgage, car payments, and other debts. Life insurance often covers the cost of funeral expenses as well as taxes on your estate.
For new parents looking to ensure that their children are financially secure should a tragedy occur, life insurance is a must! Ask an insurance agent for help finding a policy that will help protect a child’s future, and provide your family with much-needed peace of mind.