Life Insurance Tips
Life insurance cover is not only for breadwinners who have children, or for married couples. Covering perils that affect you in the long-term, life insurance can prevent single professionals from becoming financially dependent on other family members following a catastrophic accident or illness. Choosing life insurance cover, though, is no mean feat, given the number of policies and insurance companies on the market. Life.co.za recommends the following tips to finding the right life insurance cover for your needs: Purchase life insurance as soon as possible We’re not just saying this to get premiums out of you. The younger an individual is when he or she takes out life insurance, the bigger the death benefit he or she qualifies for. Younger insureds are at less risk of suffering a long-term peril (statistically speaking) and are more likely to pay more premiums during the course of his or her life than an older insured. Calculate how much you need before you look Before you even begin looking for life insurance cover, determine how much cover you and your family would need if something were to happen to you today. The payout on the life insurance policy must be able to cover your bond, outstanding debt (including credit cards and vehicle finance), current and future school fees (including university), and monthly living expenses for two years. You will need to add on a percentage of this total amount to cover inflation. Now you can look for a life insurance company that is prepared to cover you for this amount. Determine how long you want life insurance cover for Not all life insurance policies last for the life of the insured. Some individuals prefer to get term life insurance, which will cover them until they’ve paid off their home, or until their children are independent, or until they retire. Term life insurance is cheaper than whole life insurance, which does not expire. Term life insurance, though, does not have a cash value (that is, these policies cannot be cashed in, or borrowed from). Look for affordable premiums This doesn’t necessarily mean cheap premiums, but premiums that you can currently afford and continue to afford in the future. Many insurance companies provide variable life cover, which sees the premium increase as you get older and become a higher risk. Many life insurance companies offer fixed premiums with minimal percentage increases every year. Insure more than just your life Life insurance cover is not only “money if you die”. It functions as salary protection as well, paying out in the event that you become disabled as a result of an accident or disease and can no longer work. The payout (which can often be more than the death benefit) will be able to supplement your lost income and cover the expenses of a new lifestyle. The simplest way to choose life insurance cover is to compare a range of insurance policies. Armed with these tips, submit your details to Life.co.za and an insurance agent will help you compare up to nine life insurance policies.
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