How To Talk About Life Insurance With Family

how to talk about life insurance with family

Starting a conversation about life insurance is hard. You’re basically saying let’s talk about what’s going to happen when you or I die. Being without our loved ones isn’t something anyone wants to think about let alone make a plan for. However, you’ll likely have to talk about life insurance with your family eventually. 

Make a plan and understand the emotions involved before you talk about life insurance. Jumping right into the types of life insurance and life insurance costs will likely overwhelm them. But it’s important for the family to understand life insurance terms and how it all works for the future. 


How To Start The Conversation About Life Insurance 

Sometimes it’s easier to talk about hard scenarios when you blame the topic coming up on something else. For example, you could tell them about something suddenly happening to someone else when they didn’t have life insurance. Or tell a story about someone who sold their life insurance policy for cash.  

You can also begin the conversation by talking about your financial goals for the future. You will have to make some predictions and talk about different scenarios in order to plan. You may need to talk about getting life insurance coverage or surrendering the coverage you have. Both can be difficult conversations. 

If your family member seems put off by the topic then you don’t have to push it. Just let them know that you want to make a plan soon. That way you can come back and plan after the other person has had some time to prepare or research as well. 


Life Insurance Terms To Be Familiar With When You Talk About Life Insurance 

A life insurance professional can answer any questions and explain your options to you. But it’s important to have an idea of some of the terms they use when you’re discussing life insurance with your loved ones.

Term Life Insurance

A temporary life insurance policy that gives coverage for a predetermined amount of time. Additionally, the premiums may increase over time or stay consistent.

Whole Life Insurance

A permanent life insurance policy with a savings component that accumulates cash value. Premiums for whole life insurance policies stay the same. This coverage will continue for the insured’s entire life as long as they pay the premiums.

Universal Life Insurance

An insurance policy that’s similar to a whole life insurance policy in that it has a savings component and continues for your whole life. But the premiums are not fixed and can increase over time.


The recipient of the life insurance policy’s death benefit upon the insured’s death.

Death Benefit

The money the beneficiaries receive upon the insured’s death.

Face Value

The stated value of the life insurance policy as well as another term for the death benefit.


The payment (usually monthly) a policyholder makes to their insurance company in exchange for coverage.

When Do You Need To Talk About Life Insurance?

You need to talk about life insurance with your spouse, your parents, and your children. Families rely on each other and making a plan for the future gives everyone peace of mind.

The best time to talk about life insurance is after a major life event has happened. In these scenarios, everyone understands that their family’s lives have changed and you need to do some planning. 

  • marriage
  • pregnancy
  • birth of a baby
  • children becoming adults
  • retirement

When you start to talk about life insurance, make sure you understand the options available. Whether you’re getting life insurance or getting rid of life insurance. If you’re considering letting your policy lapse or surrendering, you’ll likely get more money out of a life settlement

Talking To Your Spouse About life Insurance 

The number one issue that married couples fight about is money. For this reason, it’s a topic that many couples avoid. However, when you share finances with someone, as well as a life and family, you have a lot to talk about. 

The conversation about life insurance should happen when you decide to have children. Or many people get life insurance when they get married before children come into the picture. As soon as you have people depending on you, you need to get life insurance. 

You can get an idea of how much life insurance coverage you need with a life insurance calculator. This will make your family’s needs clear before you start to talk about life insurance with your spouse. 

Life insurance premiums are expensive. This is definitely something that needs to be discussed together so that you’re getting the type of policy that’ll work for your family’s plan and budget. If you have the conversation when you’re young, premiums are much more affordable.  

Just as you need to talk to your spouse when you get life insurance, you need to have a similar discussion when/if you decide you no longer need life insurance. 

Talking To Your Parents About Life Insurance

talk about life insurance

When you decide to talk about life insurance with your parents, make sure you also ask about their will. As well as where they keep their papers, and what type of life insurance policy they have. 

As your parents get older, they’ll start to rely on you. Declining health and retirement may stress their financial situation. They could decide to do any of the following with their life insurance policy:

  • surrender their policy
  • take a loan from their life insurance policy
  • use the death benefit with a long-term care rider
  • sell their life insurance policy in a life settlement 


You may want to talk to your parents about these options if they’re having trouble coming up with a plan for retirement or a plan to pay medical bills

Talking to Your Children About Life Insurance

When your children become adults you need to talk to them about your life insurance policy. As well as your will and long-term care plans. These are your beneficiaries who will receive the death benefit when you die. If you have a term life insurance policy then you only have this coverage for a certain amount of time and you should let your children know. 

You may decide you want to get rid of your life insurance policy by either surrendering the policy or selling it in a life settlement. 

Talking About Selling Your Policy In a Life Settlement

Life settlements are not talked about nearly enough. Many people don’t know that you can sell a policy for cash. You may be eligible for a life settlement if:

  • You’re at least 70 years old or have significant health impairments. 
  • The face amount of your policy is at least $250 K. 
  • Your policy is in force for at least 2 years (some states require 5 years).


Deciding to sell your life insurance policy is a big change to your family’s financial plan. You’ll need to talk about the benefits of selling and why you need the funds now with your beneficiaries. 

If you’re considering a life settlement, reach out for a free consultation. You don’t need to be sure you’re ready to sell. We’ll answer any of your questions to help you decide the best path forward for you and your family.  

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