Life happens when you least expect it. In the current world climate, the topic on everyone’s lips is planning for the future. While checking that all your affairs are in order, you might want to consider adding life cover to your financial planning.
Life cover can act as a tool to help you meet your medium and long-term goals. It provides a form of surety when you or your family need financial cover the most. This cover offers the sense of security your loved ones need long after you are gone.
Yet, despite these attractive features, some people still feel that life cover is unnecessary. This is due in part to a number of myths about it. This post will debunk a few of these theories and tell you everything you need to know about life cover.
Myth #1: Life Cover Is Not Important
The primary purpose of life cover is to provide financial assistance to the family upon the death of the insured person. This makes it a crucial tool for anyone with dependents. It is particularly necessary for individuals with accumulated debt.
Most commonly, life cover is used to protect kids or spouses, but it’s also a good option for people with other financial goals. For example, if you don’t have assets to pass onto your heirs, life cover can help you create an estate plan and inheritance for those you name as beneficiaries. It can be a great way to set up a solid financial future for your family.
Some products even provide a payout if you become disabled or critically ill. This ensures you continue to pay the bills even in times of personal crisis. It could help to alleviate financial burdens while you get back on your feet.
Myth #2: You Only Need Life Cover When You Are Older
People at the beginning of their careers tend to focus on material investments, but life cover can be a good asset at any age. Anyone who is financially capable should invest in life cover. In fact, the sooner you take it out the better.
Multiple factors are taken into account when calculating how much you pay for life cover. Younger people with no pre-existing health conditions are more likely to receive lower premiums. They are also considered low risk because they are less likely to claim.
Life cover isn’t just for homeowners or parents. Anyone you choose can be added as a beneficiary, which means that other family members can benefit too.
Proceeds can be left to pay off a student loan, support a needy family member, or even donate to your favourite charity. The list is not limited to people who depend on you financially.
Life insurance can even provide a safety net to small business owners. This will help cushion the blow for any employees or partners who need to keep the business going.
Being young doesn’t exempt you from bad things happening. Road accidents or unforeseen illness can be a huge financial hindrance for someone at the start of their career. While medical aid might be able to take care of hospital expenses, it can’t ensure you an income while you recover.
Myth #3: Insurers Never Payout
For life cover, beneficiaries are nominated to receive a specific amount in the event of your death. Different policies provide cover for different structured needs. Your life cover can go towards your home or other living expenses. It can also be used to settle outstanding debt.
There are two ways life cover can pay out. Your loved ones could receive a lump sum, depending on the amount designated. Alternatively, life cover can provide regular earnings for your family.
These take the form of a series of consistent payouts, which act as an income to cover their needs. An assessment of your family’s long and short-term needs can help to choose a plan that best suits you.
Be aware that some policies contain exclusions in their terms and conditions. You need to review your life cover to know what you are being covered for. Knowing these exclusions could save your family the pain of having to debate over your policy’s conditions when you are gone.
Myth #4: Life Cover Is Expensive
Everyone has different needs. Each individual can find a policy that best accommodates him or her. Maysure is a financial advisory service that can help you find a life cover that is good for you and your pocket.
You shouldn’t be put off of life cover because of the cost. There are plenty of options out there and a number of ways to reduce your monthly premium.
Taking a lower cover amount, getting a policy when you are young, or even just quitting smoking are all ways that you can save on life cover.
Final Thoughts On Life Cover
The truth is when it comes to life cover you can’t afford to not have it. It is the ultimate form of financial protection and is sure to give you peace of mind.
Let us help you choose the right life cover. Contact us here:
+27 11 839 2302