Uses of Life Insurance : Family & Personal
The primary purpose of life insurance is the protection of the family.
Every family is dependent for subsistence upon an income which necessarily
varies in amount with the particular circumstances surrounding its case.
In some instances this income is obtained from the return on invested funds
which have been accumulated or inherited, but in the overwhelming majority
of cases the subsistence of the family depends upon the current earnings
of the husband. He is the breadwinner who has definitely assumed responsibility
for the support of those dependent upon him, and his wife and children have
a right to look to him for adequate maintenance. His life has a value (and
the same is also often true of the mother or son) to the dependent members
of the family, and it is this value of one life in its relation to another
that justifies the existence of life insurance. If a man owns a house or
other destructible property he usually allows little time to pass before
insuring it in some fire-insurance company. Yet why consider the value of
property as more important than the value of the life of the owner, when
in the great majority of instances the value of the latter to the family
exceeds that of the former? Moreover, the property may never burn or be
otherwise destroyed, since it appears that only about one fire occurs to
every one hundred and seventy five fire policies, while death is certain
to happen. As Benjamin Franklin aptly stated: "A policy of life insurance
is the oldest and safest mode of making certain provision for one's family.
It is a strange anomaly that men should be careful to insure their houses,
their ships, their merchandise, and yet neglect to insure their lives, surely
the most important of all to their families, and more subject to loss".
Sections in Chapter 2.