Why Do People Purchase Life Insurance

Personal Finance School Life Insurance Why Do People Purchase Life Insurance

People purchase life insurance for various reasons, but the primary motivation is to provide financial security and peace of mind for their loved ones in the event of their death.

Life insurance serves as a safety net, ensuring that beneficiaries receive a financial payout, known as the death benefit, which can help cover essential expenses such as funeral costs, outstanding debts, mortgage payments, and daily living expenses.

It can also support long-term financial goals, such as funding a child’s education or replacing lost income for a surviving spouse.

Additionally, life insurance can be a crucial estate planning tool, offering tax advantages and facilitating the smooth transfer of assets to heirs.

Ultimately, people purchase life insurance to protect their family’s financial well-being and provide a sense of financial stability during a challenging time.