It is clear that nobody likes to think that something bad can happen to our relatives or to ourselves, but not accepting the consequences can lead to many problems. Facing it and avoiding it, as far as possible, is a responsible decision. Being forewarned allows us to enjoy life better, knowing that we ourselves or our families will be fine in the event of disability or death.
Life Insurance helps nearly 60,000 families each year in the face of abandonment due to the loss or disability of a loved one. It has that purpose: to guarantee that our economy or that of our relatives will be able to sustain and recover in the event of death, of suffering an accident that may cause disability, or before the diagnosis of a serious illness. Above all, when the family nucleus depends financially on our income, in such a way that they can bear the loss and the new circumstances a little better.
Normally it is the parents who subscribe to a policy of this type so that, if they suffer a mishap in the future, their children will receive financial aid and will not be left unattended. But life insurance goes further, people who are alone can also contract it to deal with a possible situation of dependency or disability derived from an accident or illness, events that are becoming more frequent every day due to longevity.
It is important that the contracted policy adjusts to our lifestyle, family, needs and budget, since its coverage can make a difference in the future. To find out the type of life insurance that suits us best and what coverage to hire, there are different factors that come into play and that will help us decide: number of members in the family, age of the children, family needs, debts and monthly payments , etc.
Life insurance includes three modalities: Life Risk, Life Savings and Mixed Life. Risk is the most contracted in Spain and the best known. It is activated in the event of death or incapacity of the contracting party, contributing the economic amount subscribed by the beneficiaries. This type of insurance is convenient if the family depends on us so that they can cover the expenses that we supported. There are also policies that guarantee the continuity of the children’s studies or to cover the mortgage payments on our home.
Life Savings, is an insurance in which the policyholder is the one who benefits from the coverage, it is more focused on those profiles who seek to make their money profitable or who are looking for an economic “extra” for retirement. And, finally, the Mixed Life, is a type of life insurance that unites the previous two and with which we will have coverage in case of death and economic complements in life.
Aspects to take into account when hiring life insurance:
- Tranquility. For oneself and for ours. One of the main benefits of life insurance is knowing that, if we are not, or cannot continue to take care of it, our family will be covered with compensation from the insurance company.
- Flexibility. The policies are adapted to the needs of the policyholder throughout his life because at each stage our needs can change and thus be able to pay based on what we really need.
- Beneficiaries. A very important aspect when hiring life insurance. The policyholder must indicate who the beneficiaries are since the policy is not associated with the testamentary designation and they do not necessarily have to be the same as the heirs of the deceased. A point to keep in mind if we want to avoid unpleasantness.
- Disability or illness. Contracting this coverage involves meeting the related expenses that may arise if necessary in this case. As well as the payment of the compensation that is stipulated.
- Debts. Almost every family has some debt, and assuming its payment after a death can become a real headache. With the compensation that the insurer will pay, they will be able to face them. Or at least reduce the amounts of these if the contracted insured capital does not cover the entirety.
- Mortgage. If insurance with this coverage is taken out, the beneficiary of the policy will be the financial institution itself, which will cover the amount pending payment if its objective is to pay off the mortgage debt and not pass it on to the heirs.
- Tax exempt. In case of the passing of the guaranteed, the installment of capital by the back up plan as pay isn’t subject or dependent upon Legacy and Gift Expense, nor is it subject to IRPF.
- Liberated from liens. Regardless of whether certain obligations of the departed were related, by no means might anybody at any point hold onto how much extra security remuneration.
- Personal assessment allowance. That’s what another advantage is, the point at which the yearly pay explanation is documented, it will be feasible to deduct the cost of the strategy in the land capital bring segment back. Allowance for independently employed. Independently employed specialists can profit from a derivation of 500 euros.
