After the recent loss of my father-in-law, our family has been helping my mother-in-law sort through paperwork, insurance policies, bills, accounts, and all the things that suddenly become part of your life when someone passes away. As we try and see how much of her income she is going to lose from David Sr.’s passing away. I wanted to remind you sometimes it takes losing someone you love to realize just how much you don’t know about insurance. That is exactly where our family is right now.
It isn’t just insurance my mother-in-law is having to sort through paperwork, bills, accounts, and all the things that suddenly become part of our life when someone passes away. And let me tell you something: there is a lot to learn. This is why I’m grateful for the opportunity to help her because if something happens to David or I we will know what to do once we get insurance which we don’t have at the moment.
When grieving, the last thing I would want to do is sit down with a stack of papers and try to figure out what every policy means, who the beneficiary is, what is covered, what isn’t covered, and what happens next. That experience made me stop and think about something I probably should have thought about much sooner:
Do we really understand our own life insurance coverage? One term that keeps coming up is term life insurance. If you are like me and have heard those words but never really stopped to understand what they mean, let’s take a few minutes to talk about explore what it is and how it can help our families.
In simple terms, term life insurance provides life insurance coverage for a specific period of time, known as the “term.” If the insured person dies while the policy is active, the policy’s death benefit can generally be paid to the named beneficiary, subject to the terms and conditions of the policy. That sounds simple enough, but there is much more to think about when deciding whether term life insurance makes sense for your family.
The next question we had to find the answer to was why would someone need Term Life Insurance? This is the part that really hit home for me after our family’s loss. Life insurance isn’t just about what happens on the day someone dies. It is about what happens to the people who are still her. Which is Granny Sherry.
Granny Sherry owns her own home so one question we didn’t have to ask was what happens to the mortgage? But you might not be as lucky and have a mortgage or rent to pay which I would have if David passed away. What happens to the car payment, credit cards, utilities, groceries, or other household expenses?
What happens if one person’s income was helping support the family? Which thank the LORD Granny Sherry has a little bit of retirement from the Red Cross but wouldn’t have any income if David passed away and that scares me. What happens when there are children who still need to be raised or educated? Those aren’t easy questions, but they are important ones.
Life insurance can be used to help provide financial support to the people left behind. The amount of coverage a family needs can depend on its income, debts, household expenses, future plans, and the number of people who depend on that income. And that is why I think this is something we should talk about before we need it.
Another questions spouses should work out is how much life insurance does someone need? For either David and I I have no, clue and this is where I would encourage you not to simply pick a number because someone tells you that you “need” a certain amount. Every family is different. Start by looking at the people who depend on you financially.
Then think about your debts, housing costs, income, children, future plans, final expenses, and how long your family might need financial support if you were no longer here. The National Association of Insurance Commissioners has consumer information that can help people understand different types of life insurance and the questions they should consider when shopping for coverage. I like resources like this because you don’t have to start with someone trying to sell you something. You can start by learning. For David and I this site has been a Godsend.
Another question I’ve been learning to ask is what should we ask before purchasing a policy and this is another lesson I am taking away from helping my mother-in-law. Don’t be afraid to ask questions. Ask how long the policy lasts. Ask how much the death benefit is. Ask who is listed as the beneficiary. Ask how much the premiums are and whether they can change.
Ask what happens when the term ends. Ask whether the policy can be renewed and, if so, what that might cost. Ask about exclusions, requirements, and anything else you don’t understand. And if you already have life insurance, don’t assume you remember everything that is in the policy. Pull it out. Read it. Find the beneficiary information because it may need to be updated which is what is happening with Granny Sherry’s. That may be one of the most important things you can do.
Another thing David and his brothers are having to answer is what happens when someone dies. Which I didn’t have to deal with when my parents passed because my dad took care of all of this for us. But it is something David and Uncle Mike never really thought about until we were suddenly living it. There are so many things that have to be handled after someone dies.
There are insurance policies to locate. Bills to deal with. Accounts to identify. Important documents to find. Beneficiaries may need to file claims. Family members may have questions about Social Security, veterans benefits, bank accounts, property, and more. And all of this happens while people are grieving.
USA.gov has information that can help families understand some of the government-related steps that may need to be taken after a loved one dies. I wish every family knew about resources like this before they needed them. You don’t have to read everything today. Just knowing where to look can make a difficult time a little less overwhelming.
Another lessons we’ve been having to remind Sherry is to not to forget to protect herself from scams. Unfortunately, grief can also make families vulnerable. When someone dies, there can be a lot of paperwork, phone calls, emails, financial accounts, and people asking for information. It is important to slow down and make sure you know who you are talking to before giving out personal or financial information.
If someone contacts you unexpectedly asking for money, account information, passwords, Social Security numbers, or other personal information, don’t be afraid to stop and verify who they are.
The Federal Trade Commission has information about recognizing scams and protecting yourself from fraud. That may not sound like it belongs in a post about life insurance, but after helping a family member through a loss, I think it absolutely does. When you are dealing with important financial matters, being cautious is always a good idea.
One thing I have learned is that “life insurance” isn’t just one type of policy. Term life insurance provides coverage for a specified period. Permanent life insurance policies are designed differently and may include a cash-value component. The right choice depends on a person’s individual circumstances, financial needs, budget, and goals.
That is why this isn’t a post where I’m going to tell you, “You need this exact policy.” I’m learning too. What I can do is encourage you to learn about your choices and ask questions before making a decision. I can share what we can learn before we need it which would have helped me when Suzzane passed away.
If there is one thing I hope you take away from our family’s experience, it is this: Don’t wait until someone dies to figure out what insurance you have. Sit down with your spouse. Talk to your parents. Talk to your adult children. Find the policies. Find the beneficiaries. Make sure someone you trust knows where the important paperwork is located which is something else David and Mike have been having to handle not that there dad is gone.
And if you don’t have life insurance, take some time to learn about the different types and determine whether coverage makes sense for your family. Term life insurance is one option worth understanding, especially for people who want financial protection for a specific period of their lives. You don’t have to know all the answers today. You just need to start asking the questions.
From our family to yours I never expected that helping my mother-in-law through the loss of her husband would teach me so much about the things families need to understand before a loss happens. Grief already brings enough decisions. Trying to figure out insurance shouldn’t be one of the things we are completely unprepared for.
So take a little time. Pull out those policies. Ask questions. Talk with the people you love. Know where your important documents are. Know who your beneficiaries are. And learn what kind of protection you have — or don’t have. Because planning for the possibility of losing someone doesn’t mean you expect something bad to happen.
It means you love the people who would be left behind enough to make things just a little easier for them. And sometimes, the best time to learn about term life insurance isn’t after you need it. It’s while you still have time to plan.
Disclosure: This post may contain opportunities for me to earn compensation. If you click and make a purchase, I may earn a small commission at no extra cost to you.
This article is for general educational purposes only and is not financial, insurance, tax, or legal advice. Insurance products, eligibility, pricing, coverage, and availability vary by individual circumstances and state. Please review policy documents and consult an appropriately licensed professional for advice about your specific situation.
Grateful, Thankful, Blessed
Thank you,
Glenda, Charlie and David Cates