Every individual needs a personal financial plan to achieve set objectives. People have different objectives depending on their needs and circumstances in life. Some may want to maintain their current standard of living for themselves and their dependents. Sound education for their children may be the objective of others.  Wealthy people may have an interest in protecting their wealth for inheritance by their children. Income protection during active working life and provision of regular income at old age may feature prominently in the objectives of some others. 

It is however essential to consider the Risk factor in setting financial objectives.  Various risks can prevent the achievement of set objectives. What are those risks?  Essentially, the risks are human life risks. They have negative effects on financial objectives when they occur.  

Premature death is a risk that can affect a breadwinner’s objective that family members will continue to enjoy the same standard of living attained during his lifetime. It may also truncate the children’s education.  

Disability due to illness or accident will prevent a person from working. In the absence of income during the disability period, savings and investing to finance a future project become impossible.  

Old age makes people stop working either as an employee or as self-employed.  Even when one was able to save and invest, living to advanced old age creates a  risk that one can exhaust resources accumulated during active working life. 

Life insurance eliminates the risk factors. With it, people can realize their objectives with the guarantee that life insurance provides



Families need financial protection to cope with the financial effects of a  breadwinner’s premature death. The protection depends on the family’s circumstances. Financial protection need is highest when the children are at their dependency age. It reduces as the children advance in age. Financial Protection of the family is the primary reason why breadwinners must buy life insurance on their lives. 

Why is financial protection essential? The dependents derive the source of meeting their needs from the breadwinner’s income. Their needs include feeding, housing, clothing, and education. The source dries upon the death of the breadwinner. In the absence of alternative sources of income, their standard of living will drop considerably. The family may even disintegrate due to sharing the children among different family relations. 

Life insurance provides an alternative source of regular income to replace the proportion of the breadwinner’s income he would have spent on the family if he were to be alive. It can also provide a lump sum payment that the family can use for resettlement.  

A breadwinner takes a life insurance policy on his life and makes the dependents the beneficiaries. It is essential to have a good estimate of what will be adequate for meeting the income needs of the dependents in arranging the policy.  

A Term Assurance is the ideal policy for family protection. It will provide a substantial amount at a very low premium. The best policy will pay a regular income to the family until the youngest child can care for herself.



Children’s Education is an essential objective for parents. Good education enhances the opportunity for earning a good income. 

 Parents face two challenges in planning their children’s education. They have the challenge of accumulating funds for educating their children, and the possibility of their premature death. Life insurance guarantees the attainment of the parents’  objective whether or not they are alive. 

 As a parent, you can realize your objective of educating your children by purchasing an Education Assurance Policy on your life immediately after a child is born.  It is for the sole purpose of using the benefit to finance your child’s education. The policy guarantees a specific amount payable in installments when your child is due for higher education. 

 If the parent is alive at the end of the policy term, the life insurer pays the agreed benefit in installment over the period of the child’s higher education. The installment payment may be over four or five years. It is advantageous to parents, as they will not fund the child’s university education from current income. 

 The second scenario is the possibility of a parent’s premature death before the child completes secondary school. Premium payment will stop on the policy.  The benefit becomes payable in installments when the child is due for higher education.  

 The policy may incorporate an additional periodic income payment from the date of death of the parent up to when the child completes secondary school. This pays a regular income for financing the primary and secondary education of the child.    



Home Ownership is a necessity for all families. It is a key goal in planning for financial freedom. People who own their family homes derive long-term benefits from their properties. . They are free from paying rent on a property that can never be theirs. The property enjoys long-term capital appreciation. When fully owned,  the property can serve as collateral security for loans to finance a business or develop rental properties to generate passive income. 

Building or buying a house for the family requires substantial funds. There are three possible ways of funding homeownership. One is to save from income that could take a very long time to realize the goal of owning a family home. Inflation continually raises the cost of land and building materials and increases rent. Increasing rent makes saving difficult for would-be homeowners. These partly explain why many people may never realize the goal of owning their homes. 

An alternative is to use other peoples’ money (OPM) by borrowing. The use of OPM presents a better alternative. It saves the time it takes to build or buy a house. It eliminates the inflationary effect and enables the family to avoid paying rent over a  long time. The rent could then serve as part of the periodic loan repayment. 

The third is to purchase a Home Ownership Assurance Policy from a life insurance company if you are in a country where life insurance has developed to a level where life insurers finance part of the fund for homeownership. 




Borrowing to acquire a family home solves one problem and creates another. Until the borrower repaid the loan fully, the property belongs to the lender who took the property title as collateral security. If the borrower dies during the loan repayment period, the lender may foreclose the property and sell it to recover the loan balance, leaving the family homeless. Mortgage Protection Assurance eliminates this. 

Home Owners who use housing mortgage loans to acquire their properties need  Mortgage Protection Assurance. They need it to protect their investment and avoid their families becoming homeless in the event of premature death. The policy covers the life of the borrower, but the lender owns it. If the life insured (borrower) dies during the repayment period, the insurer pays the loan balance to the lender.  The policy benefits the borrower and the lender. It protects the borrower’s family from losing his equity in the property and becoming homeless. It enables the lender recover the loan balance immediately.  

The policy is on the life of the borrower over the loan repayment period. The period can be 10, 15, or more years. The sum assured at the beginning of the policy is the amount of the mortgage loan. If the borrower dies during the period, the life insurer pays the lender the loan balance at the date of death to liquidate the loan. The lender would then release the title deed on the property to the family as the legal owner.


Profile of Amos Adeoye Falade 

Mr. Falade is a 1980 graduate of the University of Ibadan.  He holds a Bachelor of Science, Second Class Honours  (Upper Division) Degree in Economics (1980), and Master of Communication Arts Degree (2002) from Ibadan. He is an Associate, Chartered Insurance Institute, London  (ACII) 1985 and Associate, Chartered Institute of  Stockbrokers (ACS) 2010. He also holds the Authorized  Dealing Clerk’s Certificate of The Nigerian Stock Exchange (2011). He is a Member of, Equipment Leasing Association of Nigeria (ELAN); Member, Institute of Financial  Planners. He is also a Fellow of the West African  Insurance Institute. 

He specialized in Life Insurance and Pension in his  insurance career that commenced in 1975. He attended several courses on life insurance including Actuarial  Aspects of Life Insurance by Swiss Re/West African  Insurance Institute, Monrovia, Liberia (1984) and India’s  National Insurance Academy (1997). 

He taught several generations of student life  insurance and pension preparatory for the professional  examinations of the Chartered Insurance Institute,  London from 1987, and Chartered Insurance Institute of  Nigeria from 1989. Since 2002, he has taught Pension 

Planning & Administration and Life Insurance at the West  African Insurance Institute, Banjul, The Gambia where he  is a Visiting Lecturer. He is also a resource person for the  Association of Investment and Portfolio Managers. 

He held top management positions in the financial  services industry. He was Head of Pension in Niger  Insurance (1982 to 1988); General Manager (Life and  Pensions), Nigerian French Insurance Company Limited  (1988 – 2003); General Manager/Chief Executive Officer,  Guardian Express Assurance Limited (2003 – 2008) where  he retired. He was Managing Director/Authorised Dealing  Clerk, Golden Capital Plc (2011 – 2014). He is currently a  Stockbroker/Dealer on The Nigerian Stock Exchange. 

He held several positions in the insurance industry before retiring in 2008. He was Chairman, Life Offices Committee (2003 – 2006) and a Member of the  Governing Council of the Nigerian Insurers Association (2007 – 2008). He represented the Association in many national assignments including the Securities and  Exchange Commission’s Committee on Pension (2001/2002), and the Central Bank of Nigeria’s Financial  Systems Strategy (FSS 2020). 

Mr Falade is a writer. He has written many articles on life insurance and pensions published in local and international professional journals. His four books on 

Life Insurance and Life Annuity are in the process of  publication.

Ebenezer Odartey Lamptey

I was born in the Eastern part of Ghana called Koforidua. I'm 43 years old and married to a beautiful wife (Eunice). I was brought up by my mother alone when our family was broke down by my Mom's best friend who turned out to be my Daddy's second wife. Life was difficult where my mum had to do other menial jobs to feed me after she was fired from work for taking me with her to work. What my mum knew was to educate me to get good grades and get the best paying job which she thought was becoming a medical doctor. finally, I ended up in the insurance industry and working for almost a decade. I enjoyed one moment in life when my mother visited me in the western part of the country while on leave. we had the best time when I picked her on my back to show how I wished we are together and my kids pulling her clothes to come down for their turn, ( Grand Maaa, Grand Maaa, it's my turn to be picked by Daddy); Unfortunately, she had a mild paralysis when her Blood Pressure raised and there was no one with her that night when she left my place to her lonely apartment. She died after six months while bedridden. I felt I have enough time for my family afterward. It never happened since I was enslaved to work from 9 to 5. I was not able to move from my comfort zone for my passion which will give me time for my family. Today, I have found what makes me happier and have more time for the people that I care for. My family time together for a silly walk and talk, questions my kids ask which take them to where they want to be in the next 100 years today. They are adults in their own world and their mind is like a lump of wet clay that whatever I print on it will stack which is the best time to give them the best they need from their mentor. I now know my wife also has a passion too.

This Post Has 2 Comments

  1. Adeoye Falade

    Your life story is interesting, and quite inspiring especially the aspect of your mom’s contribution to your life. Now that you are pursuing your passion, be an inspiration to the coming generation.

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