- Financial security for loved ones: The primary benefit of life insurance is providing financial security to the policyholder’s beneficiaries in the event of their death. The death benefit paid out by the insurer can help cover living expenses, pay off debts, and provide long-term financial stability.
- Tax advantages: The death benefit paid out by a life insurance policy is typically tax-free to the beneficiaries. Additionally, policyholders may be able to take advantage of tax-deferred growth on the policy’s cash value.
- It can be used to fund a buy-sell agreement or provide key person insurance to protect against the loss of a key employee.
- Peace of mind: Having life insurance can provide peace of mind to the policyholder and their loved ones, knowing that there is a financial safety net in place if the worst were to happen.
Overall, life insurance can be a valuable financial planning tool to help provide security and protection for the policyholder’s loved ones and their assets.