7 Scenarios That Spark the Need for Life Insurance

Though everyone's circumstances are different, most should consider life insurance at some point. Read on to understand how this invaluable coverage might apply to your specific situation.

Published 31 January, 2022

You're Single

There's a prevailing myth surrounding life insurance: If you're young and single, you don't need any.

If you're in that stage of life, your hobbies might consist of binge-watching Netflix and late nights out. Life insurance is likely the last thing on your mind. After all, no one depends on you financially.

But it's likely you have significant debt. Hey, you had to pay for school somehow, right? Life insurance can help ensure your family members aren't stuck with things like your student loan payments or credit card balance if something happens to you. And, it can help your loved ones cover funeral expenses, which cost $7,000 to $10,000 on average.

You're Married Without Kids

If you don't have kids to take care of, it can be easy to dismiss life insurance as an unnecessary expense. After all, you don't have to worry about budgeting for things like childcare, college tuition, extracurriculars, and more.

But you and your significant other likely share joint financial responsibility—not to mention the invisible costs that come with managing a household. Without one of you in the picture, any big financial goals you're working toward (like paying off student loan debts, planning lengthy vacations, or saving for big-ticket purchases) can evaporate.

You're Married With Kids

If you're married with kids, life insurance may be essential. With so many aspects of their future that need funding, it's critically important to have a strategy in place so they can still succeed in life if something happens to you.

You're a Single Parent

When you're a single parent, it can feel like the weight of the world is on your shoulders. Trying to pay the bills while raising kids without the help from a partner is one of the hardest jobs in the world.

But life insurance can help ease your mind and give those you love true financial security. You can wake up each morning with confidence, knowing your children will still be cared for when you're no longer around.

You're a Primary Wage Earner

If a household loses its main source of income, financial hardships are almost always right around the corner.

Take a look at your life's costs—house and car payments, grocery money, entertainment funds, student loan debts, daily living expenses, saving for college or retirement, etc.—and imagine trying to pay for them all while being cut off from your biggest source of income.

Life insurance can help ensure your loved ones can continue to afford daily expenses… and pay for their future dreams.

You're a Secondary Wage Earner or Stay-at-Home Parent

Secondary earners are often just as critical to the financial health of a family as a primary wage earner. If your spouse or significant other contributes to the family's bottom line in any way, that person's missing income can likely be felt sooner rather than later if something happens to them.

Consider the expenses involved with running a home. In many families, this responsibility falls to the secondary wage earner. Maybe that person is even a stay-at-home parent.

Think of how difficult it would be for you to raise children, pay the bills, shop for groceries, and do everything else managing a household requires if the person currently in charge of those tasks passed away. You'd likely need to hire additional help to keep things running smoothly, meaning you'll have additional heavy expenses over months and years.

Making sure every financial contributor in the household is properly insured can help you avoid these worst-case scenarios.

You're Retired

Even with investments, a pension plan, or retirement funds, families may still face financial hardship after the death of a retired spouse.

For one, a retiree’s death means losing their Social Security revenue stream. It may also cut off their retirement benefits, leaving the survivor with an income too low to afford life’s expenses.

What’s more, many parents want to leave behind money for their children. Even if you and your spouse are financially secure, designating your kids as beneficiaries in a life insurance policy can be a huge blessing for them when you’re gone.

Next Steps

No one likes to think about dying, but doing so could mean the difference between your loved ones struggling to make ends meet and their financial security. Life insurance can help ensure their bright future.

As an Appraisal Institute member, you have access to life insurance through the AI Insurance Trust. Visit us online to learn more* about our coverages today. Or call 800.222.9958 to speak with an insurance representative.

*Including features, costs, eligibility, renewability, limitations, and exclusions.

Underwritten by New York Life Insurance Company, 51 Madison Avenue, New York, NY 10010, on policy form GMR.