COLUMBUS – A recent national study by Life Happens found that half of the population is financially unprepared in the event that a family’s primary wage earner was to pass away. The study revealed that 10 percent of people would experience financial strain in one week and 44 percent of people within six months.
Ohio governor Mike DeWine has designated September as Life Insurance Awareness Month and Ohio Department of Insurance director Judith L. French encourages Ohioans to examine the financial impact of losing a primary wage earner and to evaluate life insurance.
“Life insurance can play an important role in a family’s financial plan and financial security but it needs to be carefully evaluated with the assistance of an insurance agent,” French said. “Educational life insurance information is available from the Ohio Department of Insurance and our representatives are available to answer any questions.”
Director French provided these life insurance insights:
How does life insurance provide financial security?
Life insurance policy proceeds can help temporarily replace a primary wage earner’s income, fund ongoing expenses, and pay other debts left behind.
What is an appropriate amount of life insurance?
The amount of life insurance a person should purchase depends on unique factors such as their family situation and financial standing, including how much a person can afford to pay for it. An insurance agent can help determine a suitable amount.
Are there different types of life insurance products?
Life insurance falls into two product classes: term and cash value. Term insurance provides lower-cost coverage for a specific time, such as 5, 10, and 20 years. Cash value insurance — whole, universal, and variable — often spans a lifetime and includes savings and investment features.
Products with different benefits are available for different types of wage earners and some policies may allow for flexible premium contribution amounts. In addition, some premium amounts may increase after a certain amount of time that the coverage is active.
How often should I review my life insurance coverage?
Circumstances associated with marriage, children, loans, employment, and retirement are reasons to increase or decrease benefits, adjust policy features, and review the beneficiaries of the policy. Remember to review the policy’s annual statement to verify the policy is performing as expected and address any concerns with an insurance agent.
Where can I get life insurance information and assistance?
Educational life insurance information is available from the Ohio Department of Insurance at www.insurance.ohio.gov and the National Association of Insurance Commissioners at www.naic.org.