There are times when people will come to think that they no longer need life insurance. Most often this occurs when a milestone has been reached like the paying off of the mortgage or cars and so on. The safe feeling that one can have when such expensive items have been paid off is a bit deceiving to say the least. When it comes to needing life insurance there is more to think about then the mortgage payments. Some times people will cancel the policy only to put extreme financial hardship on their family after they die. There are some things that you should consider before canceling a life insurance policy under the thought that you no longer need it.
So let’s say that you are newly retired and looking forward to leading the good life of daily relaxation. Now you realize that just before retiring you paid off the mortgage on your home making it yours free and clear. Thinking that the mortgage was the main reason why you got the life insurance to begin with you consider canceling the life insurance policy because you believe that you no longer need it. This type of thinking is completely wrong and without any kind of merit.
The first thing that people forget about is the burial expenses that will some with their death. The average funeral with burial will cost over ten thousand dollars. Then you take into consideration that the federal government pays only two hundred and fifty dollars of this amount and you have a big gap that needs to be filled. So where are your loved ones to come up with such cash? The smartest way is to leave them with a proper life insurance policy to make sure that there is no gap in the money that is needed to take care of such things.
Of course there are other things to consider as well. The home for instance is a big matter. Just because you have paid off the mortgage does not mean that it will not cost anything to live there. For one thing there is the property taxes that we all must pay and that can run into a lot of cash for a person. The real fact is that the government could take away the home that you worked so hard to pay for if the taxes go into default. This is a very real concern if you do not leave a life insurance policy for your loved ones to help with such expenses.
Give serious consideration to all the possibilities before canceling a life insurance policy. There is more to consider then the obvious in most cases. The last thing you want to do is leave behind a large financial burden and nothing to help cover it.