Guarding your loved ones through life insurance

While many families are left grieving with the lost of a loved one some have to deal with a burden of financial headaches because a loved one's income is no longer providing for the family.

COLUMBIA (WACH) -- You hear about it on the news just about everyday.

An accident, a fight or even a medical condition that takes someone's life.

"Think what happens if the person who's income is used to pay the mortgage dies. That home quickly becomes a burden."

But Milton Wright a Columbia independent insurance agent says this does not have to happen.

Thatâ??s why he suggests life insurance.

"There are some cultures that don't want to talk about life insurance and there's some that believe that if they start having that conversation that they are bringing on death,â?? says Milton Wright, Independent Insurance Agent.

There are two different life insurance polices that you need to know about term and universal or permanent. So what's the difference?

"In a permanent product such as universal or whole life, the more payments you make on that policy, the more cash value you build. And that's money that can be seen as an asset. It's also money that you can borrow against and sometimes you can take out,â?? says Wright.

What about term?

"The analogy I would use is an renting an apartment. You have an agreement you get a six month lease, you get a one year lease. What that means is, for that period of time you have coverage at a stated price. If you live beyond that period you often can renew it but what it means is you're going to pay a higher price to continue that coverage,â?? says Wright.

So how do you go about writing a policy?

"Rule of thumb is 6-10 times your income," says Wright.

Once you set it up keep your documents in a safe place.

In the event you die, a loved one would than file a claim with the company.

Wright says depending on the company it may take up to 14 days for a pay out.

Parents apart from life insurance you may want to consider a will and a setting up a power of attorney, especially if you have minor children.

"Usually what happens, a person loses competency or has a lack of capacity and a power of attorney will allow, what we call an agent to be able to handle the affairs for the person," Dennis Gerald, Gerald Law Firm.

A will is a legal document outlining your final wishes on your estate once you die.

An estate is considered anything you own like a car, house or even collectible items.

Itâ??s important to watch the wording of your will especially when a house is involved.

"Let's just say the decedent says I give my house to my three children. Well obliviously you can't take the house and divide into thirds. And if you have a child that wants to dominate and control the house, than the other two children have some issues with that. So now we're litigating that issue," says Gerald.

As for your life insurance policy you can set up who gets what once you die.

"You can determine what percentage goes to which beneficiary if you want. Or you can say I want it to be held in an account and only the interest be paid to the beneficiary until a certain time frame," says Wright.

Both men say itâ??s important that you update your life insurance policy, will and powers of attorney statement whenever you have a life changing event.

An example of that event would be the birth of a child or if youâ??ve acquired land.