You Just Got Engaged in Washington. Don’t Forget to Discuss Life Insurance.
If you need a sign that it’s time to focus on your long-term financial security and stability, it might be your upcoming nuptials. Congratulations! Whether it’s your first marriage or you’ve been down this path before, now is a great time to discuss your life insurance needs with your potential mate.
Other milestones might come fast following your Washington marriage. Perhaps you’ll buy a home together or start or grow a business. Will you have children or raise those you already have? Even if the kids are long out of the nest, you might wish to provide them with an inheritance of some kind. Or tend to the future of grandkids.
Maybe it’s not so important to you and your partner that your young kids, once grown, get a lump sum upon your death. Perhaps your primary financial goal is just to protect them while they’re growing up. Once they graduate from college, they’ll be well able to care for themselves. There’s a type of life insurance that covers that scenario, too.
Even if it’s just you and your spouse, would the unexpected loss of one of you impact the financial security of the survivor?
In other words, a serious and complex discussion on your life insurance needs awaits the two of you. Different products will impact your lives in different ways. Here’s a little insight into what that chat might include.
Life Insurance in Washington for Whole-Family Protection
The last thing you want to explore in-depth at the start of your shared lives is the end of life. And yet, that conversation is critical. Is there a main breadwinner? What would happen to the surviving spouse if this person died? How fragile would their financial picture be? Do you plan on having children? What would their adolescent lives be like with little or no financial security? Would they be able to go to college?
There are many forms of life insurance, but the following two main categories are a good place to start your serious chat. Many other kinds of life insurance products are variations of these two.
1. Whole Life Coverage
This coverage offers protection for, well, your whole life. Just like it sounds. As long as you continue to pay the premiums, your beneficiaries are guaranteed an eventual payout of the face value of your policy.
So if you have a $250,000 policy, the loved ones whom you declared as beneficiaries will share that amount upon your death. This death benefit is guaranteed, as long as you keep the policy in force. Therefore, your whole life insurance policy serves as a lump sum inheritance for loved ones, perhaps a way to kick-start their own lives.
There are other situations in which you can borrow on your whole life policy or even cash it in before death if you are subject to certain terminal or serious medical conditions. Ask your life insurance agent for details on all of your coverage options, but always before making a decision on the use of your life insurance.
2. Term Life Coverage
Like a whole life plan, this policy fully covers you financially up to its face value. But here’s a big difference: you only buy a term life plan to cover you for a pre-determined amount of time. If that time expires, and you haven’t, the policy ends without there being a payout. The advantage is that a term life policy costs less than whole life, and it covers you in a particularly vulnerable time in your life.
Let’s say that you have young children and want to cover their growing years, through college. After then, you figure that the kids will be in a position to maintain their own financial security. So you purchase a 20-year term life policy. If you were to die tomorrow, the kids would receive the full benefit of the policy’s face value. If you survive these next two decades, the policy will end without a death benefit because there’s, fortunately, no death.
Thinking of starting a business with your spouse? What would happen to the enterprise if either of you were to die unexpectedly? Could it survive? You might get a ten-year term life policy on both of you. This might make sense if you figure that after that first decade the company will be stable enough to withstand such a loss and you’ll no longer need coverage of this type. A Key Person life insurance policy might be also be appropriate in this setting.
How Much Life Insurance Will You Need in WA Once You Are Married?
That’s an important element of your serious discussion about life insurance. First, consider your needs. Are you both gainfully employed, or does one of you make considerably more than the other? Does one have more education than the other? Are one of you at home raising young children, or are you empty-nesters? Are you running a company? What’s your debt load?
These and other questions must be asked and answered to help you determine your life insurance needs. One rule of thumb is that you should carry a policy with a face value of ten to 15 times your salary. So if you’re the principal breadwinner and you make $60,000 a year, you’d carry a life insurance policy of somewhere between about $600,000 and $900,000.
But that’s just a starting point. Some will need much more than this, while others won’t require a fraction of that amount. Share all of your financial information and your hopes and dreams for the future with your life insurance agent, and your agent will help you determine your ideal level of coverage.
Bundle for Impressive Rate Discounts in Washington
Of course, life insurance is far from being your only form of coverage. You might also have homeowners insurance or renters insurance, and car insurance on one or more vehicles. If one or both of you have your own company you might have various forms of business insurance and perhaps healthcare insurance.
Bundling your various insurance products can offer major cost advantages. This involves buying a policy for one form of insurance with a company that already carries a different form of coverage. For instance, if you could buy your life insurance policy from the carrier who holds your homeowners insurance, you might earn special savings on one or both policies. This is called “bundling.”
This gets to the importance of dealing with an independent insurance agent, one who doesn’t work for just one carrier. Your independent broker can offer coverage from multiple brands. If you already have a homeowners policy from one insurance company, it’s likely that your independent agent can bundle it with your life insurance, car insurance, healthcare insurance, or other coverage at a cost advantage.
So when you consult with your independent insurance agent on your life insurance needs, be sure to share all of your current policies. Then let your agent go shopping.
Find Affordable Life Insurance Options in Washington
We can help you get your impending marriage off on the best financial footing. Call Vern Fonk Insurance at (800) 455-8276. You can also visit an independent agent at a Washington location near you or get a no-obligation quote for life insurance online.
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