Life Insurance Quotes

How to tell if you need life insurance after retiring

07/29/11

Many people often assume that once they've entered retirement they don't need to be concerned with life insurance. As there's no lost income to replace in the event of death, a number of retirees think they don't need a policy. A recent article by Scott M. Kahan, a certified financial planner from the Financial Planning Association, asserts that many retirees can still benefit from life insurance.

If a retiree has dependents that rely on Social Security or some form of pension income, a life insurance policy may still be necessary. Life insurance is also helpful when it comes to estate planning, as it can be used to pay estate taxes or funeral costs.

In order to determine whether a person needs a policy in retirement, Kahan recommends they ask themselves, "'Will someone suffer a financial hardship if I die?' Remember, this 'someone' could be a spouse, significant other or even a child. If the answer is yes, then you need to protect your assets or income stream. If no, then life insurance may not be necessary."

According to LIMRA International's 2010 Life Insurance Ownership Study, only 44 percent of U.S. households have individual life insurance policies. In 2009, 9.4 million new individual policies were purchased in the country, one million fewer than were bought in 2004.

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