Why is it necessary to have life insurance? If you are alive and well, you probably don’t think much about your death. Why distract yourself from enjoying life with macabre thoughts of what would happen if you died? Life is too short, right? Right. Life IS too short. Which is why you should give a little thought to what and who you would be leaving behind if you died today.
If you had to die in a car accident on your way home from work today, the very next thing your family would have to concern themselves with, after dealing with the shock and pain of loss, would be money. There are a myriad of payments involved in death, including but not limited to, the following:
The funeral
Even if you are not religious and do not want a service, the costs of burial or cremation are very high. If you were to have a service of some sort, as is generally the case, church hire, service fees, flowers, the coffin, press notices, the cost of transporting family to the funeral and food and drink for the wake afterwards cost a lot of money.
According to Times Live, a 2008 assessment showed that just a basic funeral can cost up to R9 000, a huge amount of money if you are unprepared for it.
The loss of your salary
It is likely that your salary is either one of two that supports your household, or you are the sole breadwinner. Look at your monthly costs. Without your salary every month, would your family be able to afford their living costs? Would you want to think of your spouse having to leave your home, sell your belongings and your children not go to university?
Debt
As with most people, it is likely that you are paying off debt of some kind. Houses, cars and other household goods and appliances take time to pay off. Would your family be able to make the payments without your salary?
The grieving period
The loved ones you leave behind are unlikely to recover in the one to three days compassionate leave most work contracts allow. With funeral costs, debt and the loss of your salary, taking unpaid leave is not an option.
To sum, the costs of your death would include:
- 1) your funeral, burial or cremation, which, depending on how it is done, could cost between R9 000 and R50 000
- 2) your family losing your income and not being able to afford their living costs, perhaps having to downgrade their living conditions
- 3) your family having to pay off your debt without the help of your salary
- 4) the loss of income if your spouse is too distraught to go back to work after your death
The above makes it clear why it is necessary to have life insurance and why you should not wait to open a policy, but the benefits of a good insurance policy are not limited to these factors.
Other benefits
What would happen if your spouse had to die today and leave you without his or her salary? How would you cope if one of your children passed away and left you with crippling funeral costs for which you weren’t prepared? Depending on what type of insurance you get, your policy could cover the funeral costs for your children or spouse, the loss of your spouse’s income and any loss of income if you should take a mourning period, as well as the costs if you should die.
Costs
There are many different options for life insurance policies and packages. You can choose a package that suits you and your family and that you can afford. Life insurance policies, depending on your needs and income, could cost as little as a few rand a month. With their affordability, there really is no excuse not to open your policy today.
Having peace of mind that you and your family will always be financially secure, no matter what befalls you, will allow you to enjoy to the fullest the short, unpredictable time you have with your loved ones. A good life insurance policy, tailored to your needs and affordable, can provide this reassurance.