It's a good thing that guy had life insurance. I didn't think that "Titleist" would be so legible in someone's forehead. When something like that happens, it can almost wreck a guy's whole day.

Life insurance is a tough one to talk about on a broad scale. There are basically two different options to choose from, permanent or term. Many people have very strong opinions on which is better. I for myself tend to favor one kind over the other for most cases. However, that being said, there are different circumstances when the other would be obviously advantageous over the one I favor.

Let's say this: The whole purpose of life insurance when a person is pre-retirement is to cover any debts and replace the missing income. If for example your the bread winner of the family and you bring home an income of $50,000.00 per year. There is a mortgage on the house for $75,000.00 and you have a car loan for $10,000.00. The credit cards are paid off monthly (good for you), but you have a personal line of credit at your local bank that you dipped into for a new set of golf clubs, lets say $2,500.00. First of all your house may have mortgage insurance on it that you consider cheap. You might be able to get a term rider on your policy for even cheaper than what you pay at the bank. Plus you can then have that money to do what you want with (at the bank you have no option it pays off the mortgage, end of discussion). As far as replacing the income goes a fair rule of thumb is ten times your income. That would mean $500,000.00 of insurance for the income part plus another $82,500.00 for covering all your debt. That would come to a grand total of $582,500.00. Then what I suggest is that we round that number up to $600,000.00. After all, we still have to bury you. What ever kind of insurance you buy, make sure that you get the proper amount and that you don't pay too much for it. As far as a coming into retirement, or post retirement person is concerned, then the main reason for insurance usually becomes estate and tax planning purposes. Again, make sure you get the right amount and that you are not paying too much for it.

I highly recommend that what ever kind of insurance you buy, you sit down with a professional and discuss exactly what you are getting, what your options are, and that you truly are properly insured.