Sunday, February 10, 2013

Why Buy Insurance For Parents?

There comes a time in every parent-child relationship where the roles reverse, where the parent becomes the child and the child becomes the parent. And when that change takes place, part of your responsibility is to make sure that your parents have a sound plan in place for the inevitable day when they are gone.

Buying life insurance for parents is not an easy thing to do, but it's important and necessary for so many people. Some children buy life insurance on their parents in order to make sure that there is enough money to pay for burial or final expenses when their parents die. Others buy life insurance on their parents in order to create or preserve an estate that can be passed along to surviving children.

Getting your parents Medical Insurance also help you, as children, in avoiding financial difficulties. Imagine your parents need RM100,000 for medical bill and you have another 2 siblings. If all siblings are working and have the ability to earn, each would have to fork out RM33,333.

What happens if your spouse disagree?

What happens if not all siblings are working and earning money?

Regardless of your reasons for needing to buy life insurance for your parents, one thing that most insurance companies will look require before issuing a policy is called "insurable interest." In the most basic sense, insurable interest is proof that, should your parents die, you would suffer some kind of financial loss. This requirement protects insurance companies from issuing policies that are taken out by children who simply think that their parents may not have long to live and create a fortune by purchasing big life insurance on them.

Once it has been established that you do in fact have an insurable interest, you need to choose the type and amount of insurance coverage to purchase.

Another consideration should be your parents' current health status. It can be difficult, even at a younger age, to purchase life insurance if you have serious medical conditions.


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