Ever thought about getting life insurance, but somehow you just never got round to it? Searching through life insurance options, comparing life insurance providers and policies, and finding the right policy can seem like a task better suited to another day.
However, finding the right policy isn’t as hard as it seems, and while it can take some time, getting life cover is worth it. It not only provides you with peace of mind, it can also help to cover your family if something bad were to happen to you. You should always check what is covered. For example, this life insurance policy will pay out up to $1 million in a lump sum. For some, however, that may be too much, so to lower the premium they may choose to be covered for a lower amount.
At what age should you get life insurance?
While many people think you need to get life insurance when you reach a certain age (when you become a ‘grown-up’), life insurance is actually more about personal circumstances than it is about age. There’s no age that you reach when life insurance becomes essential. You could be in your twenties or you could be in your forties.
When should you get life insurance?
If it’s about circumstances, what are those circumstances? First off, you’ve got to think about who depends on you. Do you have a partner? Kids? Elderly relatives you take care of? If you have anyone who is financially dependent on you, then getting life insurance is certainly a good idea.
If you have a mortgage or other bills to pay, personal loans, credit cards or car loans to cover, then you need to think about how your loved ones would cover those costs if you were no longer around.
While it’s not the nicest subject to think about, it is a valid one if you want to protect your family’s future.
Why do you need life insurance?
Bear in mind that life insurance is not just one standard product. There are different types of life insurance, offering different types of cover. Standard life insurance could help your family to cover everyday expenses, or it could pay off the mortgage, or it could pay for your kids’ education.
There is also funeral insurance. Funerals really aren’t cheap, and it can be difficult getting together money to cover funeral costs at short notice. Funeral insurance can help to cover those costs, helping to remove financial stress at an already difficult time.
Some life insurance policies have varying levels of cover for illnesses. If you become ill, your life insurance could pay out to help you cover medical costs, home care and day-to-day expenses.
Income protection insurance can also be sold alongside life insurance. Income protection insurance can offer a kind of ‘paycheck’ if you become sick or injured and can no longer work. This can help to cover medical and everyday expenses when your real paycheck is no longer coming in.
How much life insurance do you need?
Before you start trying to work out how much life insurance you need, it’s a good idea to find out if you have cover elsewhere. Some retirement funds have life insurance included, so find out if you’re covered, and how much cover you have.
While some people say you need to take out a policy worth ten times your annual salary, others prefer to use a life insurance calculator for a more accurate figure. It can also be a good idea to speak to a life insurance expert for advice.
How do you find the right life insurance?
In order to find the right policy, you need to compare all your options. Once you know how much you need, try using a comparison site to narrow down your policy options. Do some research to find out what’s available and what you might need, and read the small print to make sure you find the best option to suit your needs.
Since my wife makes the same pay I do (we are both mechanical engineers), we didn’t need life insurance until our son was born. We then took out $500k policies to cover each of us. Some people might think that $500k each is not enough, but we already had a lot in savings and investments when our son was born.