How to Use Life Insurance

Having life insurance is an easy way to provide an estate after your death. The key is to make sure a creditor cannot attach a value to the policy. Dying is not cheap—the cost of burial alone can reach above $10,000. Life insurance will alleviate the financial burden to your family. Read on to learn more.

Instructions

Difficulty: Moderate

Things You’ll Need:

• Insurance agent
• Life insurance policy

1. Determine if your life insurance policy has retained the right to purchase. You can repurchase a life insurance policy if your agent had the company make certain provisions on your behalf.
2. Review your life insurance policy with an agent regularly. Yearly your needs and beneficiaries could change.
3. Learn about changes in tax laws reanalyze your insurance needs with an attorney and financial advisor.
4. Report changes in income, age and overall health. Change insurance policies as needed.
5. Understand inflations affect on the face value of your life insurance policy—you may need to increase the dollar amount as inflation rises.
6. Consult with an attorney and financial advisor for reason of taxation. Estates are not tax-free. Beneficiaries may have to pay taxes on any inheritance. You can provide for taxation in your will.
7. Decide if disability is a greater possibility than death. Choose which type of insurance best suits your need.

Tips & Warnings

• Check for incident of ownership with the insurance company.
• Everybody’s life is worth something. Do not think insurance is just a waste of money.