If you or a family member die in a traffic accident or natural disaster, the same event that caused the death may leave your family with related repair costs to an automobile or home.
Edward Graves, author of “McGill’s Life Insurance” recommends using your life insurance policy as an immediate source of cash to help replace damaged property and address unplanned emergencies.
While some families might have the funds necessary to cover everything, the immediate cash from a life insurance policy can be a lifesaver for others. CNN Money suggests five tips for starting a family emergency fund, just in case.
The damage from windstorms, lightning, tornadoes, hurricanes, flooding or earthquakes might not be covered by your homeowner’s policy.
A homeowner’s insurance policy requires you to temporarily repair any damage to your home after a disaster to prevent further damage. If you do not have the immediate cash to make these repairs, the eventual property insurance claim settlement might be sharply reduced. This ultimately means you will receive less financial support from the insurance company. Having the extra amount of cash from life insurance proceeds can make all the difference.
When it comes to dealing with unplanned events, Marc Belletsky, spokesperson for The Hartford says cash is king.
“The security of having a source of liquid cash has value that can’t be overstated,” Belletsky said. “A life insurance policy helps address immediate needs, cover losses, pay hospital bills and provides the necessary cash for your loved ones to keep on living.”