How Does Life Insurance Work?


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Life insurance can be an important financial resource and help protect you against unexpected events. Single people can use life insurance to pay personal debts and medical and funeral bills.

The amount of life insurance you need depends on your situation. Before you decide, evaluate the pros and cons of life insurance coverage as you age. Things to consider include whether your spouse is still alive, whether you have paid off your home, and whether your children or grandchildren are financially independent.

You may qualify for a free or low-cost insurance policy from certain companies or local credit unions. If you decide to get life insurance, make sure to review your policy every year and update it to reflect any changes in your life.

Learn more:

  • State Departments of Insurance: Find your state’s insurance department to get more information at naic.org/state_web_map.htm.

  • Tips for Buying Life Insurance: Explore this advice from the National Association of Insurance Commissioners.

  • How Much Life Insurance Do I Need? Use this online calculator from Northwestern Mutual to find out.