Aim: What is the purpose of life insurance?

Do Now: List your current financial responsibilities at home. What are your parents’ financial

responsibilities?

Date: Tuesday, May 6th 2014

What is Life Insurance- Video

• Sharina's Life Insurance Blog

What is life insurance?

• Provides financial support (money) to your family or other dependents after your death.

• Death benefit-helps those who are left behind to meet important financial needs such as– Funeral costs– Ongoing living expenses– College funding

What is a dependent?

• A child, husband or wife, possibly a parent, sister or brother, even a business partner

• Anyone who depends on you financially

3 Key Questions

• Do I need life insurance?• How much do I need?•What kind should I buy?

1. Do I need life insurance?

• Evaluate your families needs• Gather all of your personal financial

information and estimate what each family member would need to meet current and future financial obligations

• Tally all of resources that your surviving family members who draw upon to support yourself

Family Needs Resources to meet them

Life Insurance Need

2. How much insurance does a person need?

• How much money will my family need after my death to meet immediate expenses?– Ex. funeral costs and debts (mortgage balances)

• How much money will my family need to maintain their standard of living over the long run?– Ongoing expenses– Future obligations

3. What kind should I buy?Term Life Insurance • Provides protection for

a specific period of time• Term periods range

from 1 year to 30 years. (20 years most common)

• Advantage-Lower initial cost compared to permanent life insurance

Permanent Life Insurance• Provides permanent lifelong

protections as long as you pay your premiums

• Has a cash-value

Discussion Question

• How would a stay-at-home parent benefit from having a life insurance policy?

Charting My Course Activity

HW Due WednesdayCharting My Course Activity