When it comes to life insurance there is a lot that has been said over the years. That makes it hard to separate the facts from the myths. You can of course try to contact your insurance broker for more info.
Your broker is going to give you the textbook answer their training entails. With that, you are unlikely to get the answers you need rather, you get a sales pitch. But over the years some myths have been busted.
Some may confirm your fears but most of the facts about life insurance policies may come as a total surprise to you. Here are four facts you need to understand about life insurance before you take that leap of faith.
1. It’s Not Expensive
Try floating the idea of life insurance to your buddies while you’re having drinks on a Sunday afternoon. Assuming all of you don’t have life insurance, half of you will assume that it’s an expensive undertaking.
See, like your friends, most people tend to overestimate life insurance costs and would rather ignore the idea altogether. But did you know you can get life insurance for around $30 per month, and secure a healthy life policy?
Assuming you’re 30 years, and you’re paying $30 per month, for around 20 years. With this, you can secure a term life policy of $ 250,000. Depending on your health among other factors, you can secure a life policy for quite a manageable amount. The younger you apply, the better.
2. Better to Start Young
Life insurance isn’t for the old as you may think. You can generate as many excuses as you possibly want but being young shouldn’t be one of them. You may assume being young, unmarried and with no dependents should give you a pass, but that’s the opposite.
If you start young, you’re likely to get a better deal with your life policy. When you’re young, you haven’t developed several health complications than when you’re older. You also get to pay the policy longer than someone who starts paying at 50 years. Even if you do have a pre-existing medical condition there are still a number of life insurance options available. UK broker Reassured have a dedicated impaired risk team who could help.
Another thing you need to consider is that when you’re younger life policies are cheaper. The older you get the expensive it gets. And think of it in this breath, in the event of your death, what financial strains are you leaving your loved ones with?
When getting the right premium, you get cover on funeral expenses, credit card debts, and other loans including car loans. Your loved ones get huge financial burdens taken off them when you purchase this premium.
3. You Can Save But Still Get the Cover
First, saving should be encouraged for everyone. But if it comes to a choice, you had better look to put your money in both kitties. With your life policy, you can build up a cash value that you can borrow against your policy.
The component that allows you to borrow against your policy also allows your beneficiaries to get death benefits. The pros behind qcapital.com point out that you can get more acquainted with what you should expect those you leave behind will get. Bottom line, as long as your financial situation allows you to get the policy and still save, you should. You can also talk to your agent and see how you can work out your finances and how you can pay for the premium.
4. You Need a Personal Policy
Most people, especially the ones in employment tend to assume that as long as they have the employment policy they are good to go. That shouldn’t be the right mentality when it comes to taking out life insurance.
First, most life insurance policies taken by the office on your behalf may not be enough for your family in the long run. For most, the payout is usually just double your base salary which is likely to be enough for your funeral expenses alone. Another thing is that when you leave your job, the premium doesn’t come with you.
You need to have a different cover to ensure that your loved ones are well taken care of. They’ll be better off protected with your policy on top of the employment policy. If you can afford it, don’t think twice about the idea of purchasing a separate policy.
Over the years, there have been several ideas floating around where life insurance is concerned. Getting your facts right may save you a lot of stress when you want to purchase a premium. Here are a few facts that should help you delve into these waters.