When their budgets are limited, many single parents feel like they shouldn’t spend extra on a life insurance policy. However, in the long-term, paying a small premium can provide financial security for your family in the event of your passing. Here are a few points about life insurance that single parents should consider.  

Why Do Single Parents Need Life Insurance?

Many single parents are the sole providers for the family, so children may be left without much or any financial assets if their parent passes away.

Life insurance helps prevent this circumstance by providing your children—or other beneficiaries—with a set amount of money if you pass. These funds can help pay for funeral costs and cover debts that would otherwise be passed onto your child or another responsible party. This money can also pay for expenses related to raising children—such as college tuition and medical services.

What Are the Options?

There are two standard types of life insurance that single parents might consider: term and whole.

Term life will provide your beneficiary with a specific payout upon death over a set period. Once this period expires, the payout will no longer be available. As such, term policies are more affordable than whole life premiums.

The period of coverage can also be adjusted to cover a child’s expenses until they become an adult. For example, you might consider a 20-year policy if your child is currently 10. If you pass away, this plan would provide a benefit payout until your child is 30 years old.  

Whole life insurance covers you indefinitely but is considerably more expensive than term plans. However, these policies eventually build cash value that you may borrow against later in life, even if you are still alive. This safety can be helpful for single parents that do not have retirement support or coverage from a partner.

How Much Coverage Should You Get?

Consider both the short-term and long-term expenses your child may face. In addition to covering general needs—such as food, clothing, and healthcare—you may also want to make sure your benefits cover the remaining mortgage payments and education expenses. If your child is younger, you may need more funds to support them until they become financially independent adults.

If you’re a single parent looking to provide protection for your child, IGO Insurance can introduce you to a wide range of life insurance solutions. Serving the Raleigh, NC, community for more than 45 years, this experienced insurance agency will design a policy that fits your budget and covers potential expenses. They also offer other plans to help safeguard your finances as a single parent—including auto, health, and homeowners insurance. Visit this agency online to learn more about their policies or call (919) 782-1560 to request a custom quote.