Life insurance is a topic that people of all ages often prefer not to think about.
Millennials are no exception.
But as this generation heads further into adulthood, they may not be able to avoid it for much longer.
The protection life insurance could provide may be essential for many young adults, but that doesn’t make it any less confusing.
To help, here are five things Millennials should keep in mind when purchasing life insurance.
There’s no right time to buy it.
Life insurance is sometimes viewed as a product for “grown-ups” or “old people.”
Younger, single adults may feel that a policy isn’t right for them if they haven’t yet reached specific life milestones—marriage, buying a home or having children.
However, the decision to purchase cover could be appropriate for people in a variety of circumstances.
Younger Millennials may want life insurance if they hold large debts, such as car or student loans.
A benefit could help their parents pay these off if the insured were to pass away suddenly.
Similarly, those without a spouse or children may still have family who rely on them financially, like a parent or sibling.
Life cover could help replace lost income if they were no longer around to provide for them.
Your insurance needs may change as you get older.
As our lives change, the amount of life insurance we need may change as well.
Millennials especially might want to review their policy on a regular basis to make sure it’s still a good fit.
Life milestones like marriage or having children often prompt people to take out life insurance in the first place.
However, young adults may experience a variety of other events that could change their insurance needs.
Entering a de facto relationship, getting a promotion or renovating a house may all mean that more life cover is needed to provide the same peace of mind.
It can cover more than just death.
When we’re young we often feel invincible.
At the very least, death is an event that will happen far into the future.
It’s generally not something that those in their 20s and 30s worry about, and may not see much of a need to plan for.
For that reason, buying life insurance might not be a pressing concern for many Millennials.
However, life insurance often covers events other than death that can affect young people.
Many policies pay the benefit early upon the diagnosis of a terminal illness.
They may also offer options covering traumatic events, such as suffering a major head trauma or becoming paralyzed.
In this way, life insurance could help pay medical costs or replace an income if someone is unable to work.
Some hobbies might not be covered.
That feeling of invincibility may also encourage younger adults to try adventurous activities.
This type of fun can create lasting memories whilst on holiday or become a rewarding hobby.
But, some pastimes may be considered especially dangerous and might not be covered by every life insurance policy.
Some life cover may place exclusions on activities that involve high speeds, heights or depths.
This might mean that the benefit will not be paid if a death or accident happens whilst engaging in things like skydiving, scuba, rock climbing or caving.
Whilst this shouldn’t discourage anyone from taking out a policy or trying something new, they may want to at least be aware of any such exclusions.
A policy might cost less than you think.
The cost of life insurance seems to be a mystery for a lot of people.
Unlike many other products, it’s not something we often think or talk about.
As a result, consumers in many countries tend to overestimate the price of policies.
Millennials may be pleasantly surprised by how affordable life cover can be.
For example, $100,000 in cover from Momentum Life (a leading New Zealand life insurance company) could cost less than $12 a month for a 34-year-old woman who doesn’t smoke.
Low premiums like these could fit almost any budget, without breaking the bank.
Think about getting covered
Life insurance could be an important tool in a Millennial’s financial portfolio.
As this generation gets older, a policy suited to their individual circumstances and needs could provide protection against the unexpected.
Don’t keep putting it off—set aside time today to decide whether life insurance is right for you.