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Too soon & not enough: The importance of life insurance

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Clarence Coleman recently learned the importance of maintaining life insurance after his wife, Chelsea, died unexpectedly on Christmas Day 2022. The event left 31-year-old Coleman and his two sons emotionally and financially fearful of the future. Fortunately for the Coleman family, Chelsea had a life insurance policy, courtesy of her job.

“Although dealing with her passing has been rough, it still is, that [life insurance] policy really helped out,” Coleman said. “I understand it’s not always like that for everybody. Some people have to make GoFundMe accounts because there was no life insurance.”

GoFundMe’s giving report verifies Coleman’s statement. According to the giving report released by GoFundMe in 2021, nearly $15 billion has been donated to people in need on the platform since 2010. The giving report also found that one in three GoFundMe accounts are set up on behalf of someone else.

September is Life Insurance Awareness Month, a time to educate people about the importance of life insurance and how it can help safeguard loved ones financially. Many people of color do not have life insurance.

According to the Life Insurance Marketing and Research Association (LIMRA), 48% of Black Americans do not have life insurance. The same study claims that 44% of Hispanic Americans do not have life insurance and that 47% of Asian Americans do not have life insurance.

There are two main types of life insurance: term life insurance and permanent life insurance. Term life insurance is a temporary policy that provides coverage for a specific period, such as 10 or 20 years. It is one of the most affordable types of life insurance, but it does not build cash value. Permanent life insurance is a more expensive type of life insurance that provides coverage for one’s entire life. It also builds cash value, which one can borrow against or withdraw.

When people do not have one of these forms of life insurance, loved ones are often left to fend for themselves financially in the event of death. This can be a major financial burden, especially if the departed is the primary breadwinner.

Indianapolis resident 31-year-old Duane Bean, a married father of two young boys, recognizes the financial influence he has on his family. Resultingly, Bean opted to purchase life insurance for himself and his loved ones.

“It’s important to me,” Bean said. “You never know when you could be out of here, plus it is cheap. I know a co-worker who is currently dealing with funeral expenses because her boyfriend didn’t have life insurance. They have a GoFundMe page as we speak.”

Life Insurance Awareness Month highlights the importance of talking to loved ones about the value of owning life insurance this September. For those interested in obtaining life insurance policies, contact a local life insurance agent.

Contact multi-media staff writer Noral Parham III at 317-762-7846 or via email at noralp@indyrecorder.com. Follow him on Twitter @NoralParham. For more stories by Noral similar to life insurance awareness month, click here.

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