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5 reasons to give the life insurance gift | CoverLink insurance

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Kelli Young

, 2020

The best time to buy life insurance is when you are young and healthy because the cost of your insurance will never be lower. However, young people do not often have the money to buy life insurance – cue the perfect holiday gift for the impossible person on your list!

Here are five reasons why the life insurance gift will make the perfect holiday gift: [19659005] It can lock in their insurance ability secure against unforeseen health problems that may prevent them from getting life insurance later in life.

  • It starts building cash value early and starting younger gives the money that much more time to put together. This greater cash value can come in handy when it's time for your recipient to buy the first house, put children through college, or even retire.
  • It locks in lower premiums . It is much cheaper to buy life insurance when you are young and healthy. By covering the first years of premiums for someone, they can benefit from these lower premiums.
  • It creates a sense of responsibility why life insurance makes a huge gift, as it can help prepare someone for big steps in life – a mortgage, a spouse or children. Nevertheless, studies show that up to 23 percent of families with children under the age of 18 do not have life insurance. Even for those who have insurance, there is a concern that they may not have enough.
  • It provides a death benefit . At a time when students are graduating with an average of $ 26,000 in student debt, not to mention credit card debt and apartment rentals, young people can have a surprisingly large amount of final costs. is an important decision and there are several things to consider:

    • How much insurance to buy . The amount is something that really depends on the facts and circumstances surrounding the gift. It might start with $ 100,000 or so, which provides a good basis for immediate protection, but it leaves room for the insured to add more protection as income, assets and liability grow.
    • Long-term affordability . If the premiums will not be gifted forever, the recipient will at some point have to take over the responsibility for paying the premiums, and they must be able to take that responsibility.
    • Who owns Ultimately, the recipient should own the insurance, but many times the insurance begins to be owned by the person giving it, who later transfers it to the insured.
    • The tax consequences of the gift . It is considered a gift when the ownership of a life insurance is transferred to the insured. If the insurance is owned by the insured and the premium is paid by someone else (for example the parent), it is also considered a gift. The gift amount depends on the value of the police when it is transferred. Gift tax can be avoided if the amount is below the annual gift limit or if it does not exceed the person's lifetime. Contact your tax advisor for more information.

    Life insurance can be the perfect gift that gives real perseverance. As consumers switch from buying things to shopping experiences and as a desire for financial security becomes a goal, more and more people choose gifts that can create a sound foundation and stability. Contact CoverLink Insurance today and we will help you get started.

    • Life insurance


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