There are different sizes and shapes of families, ranging from traditional nuclear families, couples without children, seniors with grown-up children, and single parents, among others. One thing is, however, common – they all need insurance.
The single-parent family is one of the most common family norms in the world today. Research done by Pew Research Center has indicated that the United States of America has among the highest rates of single-parent families – one out of four children live with a single parent.
Single parents make a lot of decisions on their own. They will choose schools for their children, childcare for them, and many other things. However, one of the most important decisions they need to make is the type of insurance they should take.
Here are different types of insurance to consider as a single mum;
Life Insurance
As a single parent, your children depend on your income until they get to a point where they can work for themselves. This means that you should take life insurance. Generally, it is always good to look for a policy whose value is not less than ten times your income every year.
For example, if your annual income is $100,000, you should get a $1,000,000 policy on life insurance. However, your life insurance policy might depend on things such as your expectations and the amount of debt you have.
But how does this work? Do you know how life insurance policies work for single parents? Well, the best way is to ensure that your children are the beneficiaries of the insurance policy. Doing this will enable them to get the death benefit in case you die.
The death benefit can be defined as the money that a beneficiary receives in case the person insured passes on. This money is tax-free and all of it is paid at once. You can name a trustee to take care of the money until your children attain a certain age.
Critical Illness Insurance (CII)
Critical illness insurance, also known as CII, gives you a lump sum in a situation where you are diagnosed with a life-threatening and covered illness such as stroke, heart attack, or cancer, among others.
After you are diagnosed, the money is paid directly to you. This means that you are at liberty to spend the money the way you would like to. However, depending on your insurer, the amount of money you get might be subject to conditions such as the time you have to survive.
This might leave some people asking whether pandemics such as the recent COVID-19 pandemic are covered under CII or not. Well, this depends on the insurer you choose to work with. Some insurers might cover it, while others have reservations.
Let us take an example where you are diagnosed with cancer. You take a leave from work to take care of yourself. Your employer pays you for three months but you stay at home for over a year. With CII, you can get more money in a lump sum to take care of yourself and your children.
Disability Insurance
Being the sole breadwinner for your children, you also need to think about the things your children would go through if you become disabled and are not able to continue working. This is where disability insurance comes in.
It provides you with income in a situation where you are now disabled and not able to work for more than a specified time. However, for you to qualify for this type of insurance, you must ensure that you have an established and steady source of income.
Even though most companies are now providing coverage for disabilities that happen in the workplace, you need to think about what would happen if you lost your job. In addition, getting multiple coverages is not a bad idea.
Health Insurance
This is an important type of insurance every single mom should have. The truth is that your children will need to visit the hospital or see a doctor from time to time. You will also need the same to ensure that you are all healthy.
Today, people are spending more money on healthcare than they did a couple of years ago. You can easily spend $6,000 a year on healthcare as a family every year. Do you have this kind of money lying somewhere?
Well, there are different types of health insurance. You just need to make sure that you have chosen the one that meets your needs – and your budget.
With these insurance covers, you can live a stress-free life knowing that both your children and yourself are covered in case something happens.
