It is very important and highly recommended for you to take a life insurance cover, if you are the highest earning member in the family.
Mr. Santhosh, 43, has a home loan of Rs.15 lakh for a tenure of about 20 years. He has a 11 year old son and a wife who is not working presently. Considering the present day working and stressful conditions, there is high possibility of entering into serious health issues. If Santhosh is able to take an adequate life cover that will help him cover the entire home loan and provide for his wife’s and son’s expenses for a certain period, he is called a prudent investor.
Now, in a worst case scenario, on the eventuality of Santhosh’s death, the loan amount will be passed on to his non-earning members in the family or they will have to get rid of the house to repay the loan.
In order to avoid such ugly situations and put your family into jeopardy, it is best advised to take a life insurance cover as it will help you and your family in case of medical emergencies and in situations where the policy holder, who is liable to repay a loan, dies, then the policy amount can be used for repaying the loan and retaining the asset.