Most people understand the importance of term life insurance as it replaces the income of a loved one when they pass away. This is important because even after they pass, the family still has ongoing financial obligations. This could include paying off the mortgage, funding the children’s education, and simply maintaining their standard of living.

Most term life insurance policies are taken out to insure the income of the working spouse, or both working spouses. But what about buying life insurance for a stay-at-home spouse? Often times, the main objection is "he/she doesn’t produce an income, so why would they need life insurance?"

The financial impact of a stay-at-home spouse is just as important as a working spouse. In fact, it’s probably more accurate to say both spouses work; it’s just that one works inside the home and the other works outside the home.

From an economic viewpoint, it may be more appropriate to view the stay-at-home spouse/parent as the Household CEO. Responsibilities include: housekeeper, cook, teacher, psychologist, driver, homework-helper, and errand-doer. These are important household responsibilities and according to Salary.com, the ten most popular functions performed by stay-at-home mothers equates to $115,431 per year. In other words, it would cost $115,431 to financially replace a stay-at-home spouse!

Of course, the passing of a spouse is a tragic event. They could never really be replaced. But when looking at it financially, the need for life insurance for both spouses - whether they are working outside the home or not - is obvious.

Life insurance is never fun to think about or to discuss, but hopefully this provides some insight into the importance of life insurance for you and your family.