Economic Importance of Insurance

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Do You Have to Pay Taxes on Life Insurance Proceeds?....5

Insurance is very important for a wide variety of different economic reasons. Learn more about the economic importance of insurance with help from a personal finance expert and professional in this free video clip.

Part of the Video Series: Personal Finance & Life Insurance
Promoted By Zergnet

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Video Transcript

Hi, this is Walter Pardo. I am managing director and founder of Wealth Financial Partners and WFP tax partners in Basking Ridge, New Jersey. Today we're going to discuss the economic importance of life insurance. Life insurance was originally a reason to put one dollar aside that if you die, someone gets ten dollars. And the only reason you really have life insurance is to plan for economic calamities such as I have a mortgage and if die right now, someone has to pay that mortgage. The life insurance policy will be there to cover that mortgage. That's one economic condition. Another one is if I'm out of the picture early in my life, my earning power, my income will not be there for my wife or my children. So therefore, I want to have a life insurance policy to meet that economic change if I do pass away so there are a lot of things that life insurance does. Some people treat it as an investment but really life insurance in its purest form is simply to cover the unforeseen economic calamities that could come when unexpected situations arise.

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