A Freelancer’s Guide to Life Insurance

A lot of freelancers and self-employed individuals are unsure about whether or not they really need life insurance. Not only is life insurance an extra monthly cost, but for a lot of young people it can seem unnecessary. Having life insurance, however, should be something that everyone, no matter their age, seriously considers. Not only does the life insurance contract guarantee that a payment is made to beneficiaries after death, but it ensures peace of mind that, if something were to ever happen to you, the people you love most would be cared for.

Below are just a few examples of people who should absolutely take a closer look at getting a life insurance policy…1. Parents with young children. If you’re a parent, especially of young children, then having a life insurance plan will make sure that your children don’t go through financial hardships if you were to pass. 
2. Individuals with student debt or other debt incurred by their parents. A lot of young adults today have parents who have incurred their student debt or have cosigned on a loan with them. Having life insurance in this case will make sure that parents won’t continue to be responsible for the debt if an amount is still due after his or her death. 
3. Individuals who own joint property. A lot of married couples, or couples who have purchased property together, choose to have life insurance policies because they can help to make sure that, in the case that one of them dies, the other is still able to afford the payments on the purchased property. 
4. Individuals who want a low rate. Life insurance rates are lower when you are young and healthy, which means getting a plan before you think you need it can ensure that you’re paying the lowest amount possible each month. 

Understanding How Life Insurance Policies Work

When considering a life insurance policy, it’s important to remember that they are legally binding contracts, which means the money that is promised to your beneficiaries will go to your beneficiaries upon your death. However, there are a few reasons why a life insurance policy can’t be enforced, including inaccurate personal information, like preexisting health conditions or activities that put you at a higher risk for death. Older individuals will most likely look at term life insurance policies, which will expire and then need to be reinstated after a set number of years. For younger individuals, permanent policies will remain in place until they pass. 

When you get a life insurance policy, you will pay either a single premium (less likely if you’re young and healthy) or a regular premium periodically. If these premiums aren’t paid, then your policy won’t be enforced when you pass. Getting a life insurance policy will also require you to have beneficiaries, like your children or family, who will receive the value of your policy upon your death. 

With a set of insurance and financial services specifically created for freelancers, CareerGig can help you find the best fit for your needs. Learn more about insurance for freelancers here.

Leave a Reply