Do I Need Insurance If I Don't Have Children?

Many people without children might wonder about the necessity of insurance, often viewed as a safeguard for dependents after one's passing. However, insurance plays an important role in financial stability during your lifetime, offering protection against unforeseen events that could impact your income and lifestyle.

The common notion, "I'll get some insurance if I have kids, but otherwise, it's probably unnecessary," overlooks the broader benefits of insurance beyond life coverage.

Indeed, life insurance provides financial benefits to your beneficiaries after your death, but there are also types of insurance designed to protect your finances and income while you're still alive – these are referred to as living benefits. Critical illness insurance and disability insurance, are prime examples of this, offering financial support when you need it most (i.e. while you are alive).

Living Benefits Insurance in Action

Disability Insurance: A Safety Net for Emily and Alex

Emily and Alex, a couple residing in Calgary, both have thriving careers, each earning a respectable income. Emily, an engineer, and Alex, a digital marketing specialist, share a passion for adventure and have dreams of taking a year off to travel the world. Understanding the importance of protecting their income, Emily opts for individual disability insurance, ensuring their financial plans remain intact even if she were to face an unexpected illness or injury.

One winter morning, Emily slips on ice, resulting in a severe leg injury that sidelines her from work for several months. After her physician completes the necessary documentation, Emily's claim is approved, and following a brief waiting period, she begins receiving monthly benefits from her disability insurance. These payments, amounting to 70% of her previous after-tax income, allow Emily and Alex to continue paying their bills and even saving for their future travels without overly compromising their current lifestyle. This financial cushion enables Emily to focus solely on her recovery.

Critical Illness Insurance: A Lifeline for Jordan

Jordan, living a fulfilling single life in Toronto, decided to purchase a critical illness policy after witnessing friends struggle financially due to severe health diagnoses. Jordan's foresight proved invaluable when he was diagnosed with lymphoma. Upon making a claim, Jordan received a tax-free lump sum from his critical illness policy, granting him the freedom to use the funds as needed.

With this financial support, Jordan could afford essential services like housekeeping and meal preparation during his treatment. He also chose to pay down his mortgage, reducing his monthly expenses and alleviating financial pressure. This strategic move not only helped Jordan maintain his standard of living but also secured his financial future, regardless of his ability to return to full-time work.

The Importance of Insurance for Financial Security

These scenarios underscore the significance of living benefits in providing financial security, regardless of parental status. While individuals without children may not seek extensive life insurance, a modest policy can make sense to cover final expenses - such as funeral costs. More importantly, considering the prevalence of illnesses and disabilities, living benefits insurance becomes essential in safeguarding your financial plans and quality of life.

Moreover, the prevalence of illnesses and disabilities in Canada highlights the importance of being prepared. With hundreds diagnosed with cancer daily and millions living with heart disease or the effects of a stroke, the financial implications of such health challenges cannot be underestimated.

Living benefits insurance, encompassing both critical illness and disability coverage help to ensure that your life's plans and financial stability are protected, offering peace of mind in the face of life's uncertainties.