While none of us wants to think about the worst happening, we need to prepare ourselves and our children for these events—no matter how unlikely they are. As parents, the last thing we would ever want would be for our family to be in a situation that they can’t handle, or would leave them unprotected.
When I think of an insurance salesperson, I think of a combed-over, overweight gentleman who tells me about all the possible ways I could meet my demise—and then offers me protection for a small fee of $X per month, not unlike a mob boss. As a child I remember an insurance salesman who visited our home and sold us three life insurance policies, even one for me should I fall out of a tree or ride my bike in front of a semi-truck (the latter actually happened—but I survived unscathed).
My parents purchased the policies and I’m glad they did. They both died several months later. But I digress…
It’s hard to envision our spouse and children living on without us. We obviously want them to live on and be happy, but often the mechanics of they would exist without help from the breadwinner or the home-maker eludes us.
Here are the three most important things to consider when deciding to purchase life insurance:
How much money does your family need to live a comparable lifestyle?
When we purchased our life insurance policies, we opted for a 30-year term life policy of $750,000 upon the death of me or my wife. I figure if I die, this will be enough to sustain them for a number of years. If my wife were to die, it would be enough to supplement my income so I wouldn’t need to work as much. This would allow me to spend more time with our children and fill in the role of both parents.
Don’t incentivize your death.
As great as we think our marriages are at this moment, we’ve all seen or heard about the Lifetime movie where the one spouse plotted to murder the other for insurance money. When purchasing life insurance, give your family enough to survive and life comfortably, but don’t purchase enough coverage to where there is a large enough incentive for someone to knock you off.
An angry spouse might not be willing to risk their freedom for $500,000 but for $5,000,000 it might become a different story. As outrageous as this might seem, it does happen.
“While I’ve never personally issued a policy that resulted in the murder of a spouse, these things do happen from time to time,” says Orange County insurance agent, Don Ariosto. “I had a friend who wrote an $8,000,000 life policy. 13 months later the wife was dead under suspicious circumstances”, Ariosto recalls.
Talk openly about life and death and prepare your family for the unexpected.
The best thing you can do is prepare your family to for the unexpected. Talk openly with your children and let them know that death is a part of life, and should you or your spouse pass away unexpectedly, that regardless of your last conversation or the mood at the time, you will always love them unconditionally.
If spirituality is a big part of your life, talk with your children about why your particular religion or beliefs say about death. If you don’t prescribe to religious beliefs, explain the beauty of nature and the circle of life, and how the death of one living thing benefits nature by providing nutrients to other living things. As morbid as this may sound, it will help your family be better prepared in the event you should pass away unexpectedly.
Have you talked about life insurance with your partner? Share your stories in the comments.