Aim: What is the purpose of life insurance?
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Transcript of Aim: What is the purpose of life insurance?
Aim: What is the purpose of life insurance?
Do Now: List your current financial responsibilities at home. What are your parents’ financial
responsibilities?
Date: Tuesday, May 6th 2014
What is Life Insurance- Video
• Sharina's Life Insurance Blog
What is life insurance?
• Provides financial support (money) to your family or other dependents after your death.
• Death benefit-helps those who are left behind to meet important financial needs such as– Funeral costs– Ongoing living expenses– College funding
What is a dependent?
• A child, husband or wife, possibly a parent, sister or brother, even a business partner
• Anyone who depends on you financially
3 Key Questions
• Do I need life insurance?• How much do I need?•What kind should I buy?
1. Do I need life insurance?
• Evaluate your families needs• Gather all of your personal financial
information and estimate what each family member would need to meet current and future financial obligations
• Tally all of resources that your surviving family members who draw upon to support yourself
Family Needs Resources to meet them
Life Insurance Need
2. How much insurance does a person need?
• How much money will my family need after my death to meet immediate expenses?– Ex. funeral costs and debts (mortgage balances)
• How much money will my family need to maintain their standard of living over the long run?– Ongoing expenses– Future obligations
3. What kind should I buy?Term Life Insurance • Provides protection for
a specific period of time• Term periods range
from 1 year to 30 years. (20 years most common)
• Advantage-Lower initial cost compared to permanent life insurance
Permanent Life Insurance• Provides permanent lifelong
protections as long as you pay your premiums
• Has a cash-value
Discussion Question
• How would a stay-at-home parent benefit from having a life insurance policy?
Charting My Course Activity
HW Due WednesdayCharting My Course Activity