Life insurance is one of the important elements of financial planning. But apparently, not everyone needs life insurance. Let us refer to the following descriptions.
Life insurance, In this case, is pure life insurance or commonly called traditional insurance or pure term life. Life insurance will provide a one-time payment of the sum insured if the policyholder (insured) dies at the time of protection to the beneficiaries who have registered with the insurance company.
The purpose of the sum insured is to replace the income of the insured, so without the presence of the insured, the person who is your financial liabilities are not financially burdened and do not have to lower their standards of living.
This means if you want to insure yourself, you do so for your financial liabilities. And if you have any obligation (debt), you must insure yourself at least worth the obligation, so that if you die, that obligation is not the burden of the abandoned person. So, if you have no financial liabilities and you have no obligation, you do not need life insurance.
If you are in need of life insurance, the first step is you need to check how much sum insured you need. Once you know the amount, you must stay on the plan and goal of life insurance.
It can be interpreted that you are trying to move away from other types of life insurance in addition to pure life insurance because usually, the insurance combines with investment. It is advisable to make insurance and investments separately.
Also, note the beneficiary name. For example, now you already have life insurance, be sure to always renew the beneficiary name if there is a change. For example, you're not married and the current beneficiaries are your parents. But when you marry and have a child, thus the beneficiaries can be renewed into your spouse.
In addition, maybe you already have life insurance, but your needs now change to be bigger. You can make an extra sum insured or you can create a new policy with another insurance company.
Keep in mind that your situation will always change. While you may not have any financial liabilities and no obligation at this time, perhaps some time in the future will change. In that case, life insurance is required. Remember, insurance planning is an important part of your overall financial planning and should be handled well as you plan your life goals.