What if I Do Not Purchase Life Insurance and I Pass Away?
Many people do not like spending money on insurance because they never seem to get their money’s worth. The same goes for life insurance. We will all die at a certain point, but you are basically gambling on the fact that you will die over a certain term (maybe 10 or 20 years).
And it could happen. You may live well into old age (perhaps 60 or 70 more years), or you could die next year, next month, next week, or even tomorrow. That is just the uncertainty of life. Life insurance helps your family prepare for this uncertainty.
If you pass away without life insurance, your loved ones will suffer. They will not receive any benefits. They will be able to receive your assets but not much else. Not only will they be grieving your death, but they will also face financial hardships, especially if they rely on your income or if you have outstanding debts. Without life insurance, your family may need to rely on savings or inheritances to cover expenses.
When you die without life insurance, your estate, or everything you own, is distributed among your surviving family. You may have a will that specifies who gets what. If you do not have a will, your estate goes through probate, where a judge will determine how your assets are distributed.
If you die without life insurance, your family will have to pay out of pocket for your final expenses, such as:
- Your funeral: The average cost of a funeral is $7,848. In some cases, it can be much more.
- Lost income: Without your income, your spouse and children (if applicable) might struggle financially. It will be hard to pay bills.
- Lost benefits: Jobs often offer benefits such as health insurance. Your family will lose access to these benefits should you die.
- Future expenses: Your death may make it harder for your spouse to save up for future expenses, such as children’s college.
You also need to consider debts. You likely have unpaid debt of some sort, whether that’s a mortgage, a car loan, credit card debt, or medical bills. In the event of your death, your creditors will be repaid first. Whatever is left will go to your heirs. If you have more debt than assets, your family will get nothing. Life insurance can help make sure your family is left with something to make your loss easier.
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Not everyone needs to have insurance. If you do not have it, your loved ones will be on the hook for paying for your final expenses unless you have an estate plan in place or give them money ahead of time.
Purchasing life insurance is an easy way to ensure your family is cared for in your absence. Hartman Insurance Agency, Inc., in Saline, Michigan, can discuss life insurance with you and help you understand how it could benefit you and your family. To schedule a consultation, call (734) 999-4190 or fill out the online form.