Life Insurance | Why do you need a Life Insurance?
Life Insurance is unassumably a part of everyone’s life and therefore gaining clarity and understanding on the products we are exposed to will enable us to be a better informed consumer and allows us to make desirable decisions that suits our personalized needs.
Life Insurance inarguably provides us and our families with protection against financial losses and generally alleviates our financial burdens in events of unexpected events such as death, critical illness or disability.
Life Insurance | What is Life Insurance?
Life Insurances are in place to create protection over our finances during contingencies such as unexpected occurrence of death or permanent/temporary disability of anyone but especially the breadwinners of the family. In event of mishaps, income is usually the biggest fear and concern of most; as the setback in income may lead to tightening finances to cover daily expenses. Income goes on a pause but yet life goes on. However, with the right life insurance products in place; we are assured that our daily expenses will be well fended for even without earnings during the course of happenings.
Life Insurance is mainly categorized in 2 forms.
Traditional life insurance products primarily focuses on protection coverage to ensure that our finances are well protected against any expected turns of events along with some non-guaranteed components based on the performance of participating funds.
On the other hand, the term insurance products provides strictly for protection coverage with no cash value in the product itself. Some life insurance products comes bundled with investment components where we can utilise it for retirement income or to accumulate as savings for future uses.
Life Insurance | What is your goal?
When it comes to coverage, there are also some crucial questions that we need to consider when deciding on the right product for ourselves.
We can start by assessing ourselves on these few matters:
What is your current coverage?
How much are you insured for now? How much do you want to be insured for? This question calls for some self-reflect and self-love. In an event if we are disabled, do we wish for our lifestyle to stay the same as before? Or are we comfortable with some tweaks in living quality as expenses has to be compromised due to the temporary or permanent loss in income? Many a times we would wish things to stay the same as before anything hits us, so in this case are you prepared for that?
Some other questions to check against is:
How many dependants do we have to cover for?
How old is our youngest dependant?
What are the debts we are due to pay and how long do they run for?
How much to set aside or prepare for our children’s education?
How much savings do we have?
That mentioned, some of us might also have investments holdings that we would like to check against.
What is profit that we want to see over a period of time?
Letting our money run harder than us objectively gears us for retirement or a dream of financial freedom.
Though insurance investment plans will not make us a millionaire overnight, it will definitely help us to make our money run faster than to leave them sitting in the bank. If the investment returns is able to outperform the inflation rate, it will assure us that we will get to our goal in the given time.
Some of the insurers also project your potential earnings so that we can estimate or predict the amount that we can expect to see assuming everything goes well.
Ideals aside, one of the similarly critical question is your affordability.
Can we afford it?
This is not a question to challenge your pride. Everyone can dream to have a prospective and cushioned future but we need to understand that insurance plans can only and assures us that our current position will not be affected during rainy days.
Buying insurance is a long-term commitment and it is really important that we can afford the premiums payable and understand the premium payment terms. Once we commit, we need to ensure that we follow faithfully with our insurance plans else it will be a penalty loss on the insurance plans.
Life Insurance | How much is it going to cost you?
Definitely the cost of choice is the biggest question in making life coverage commitments. The premiums that will set us back would depends on our needs and expectations as mentioned above. With a higher coverage will bring about a higher premium cost. The most important question is the premium affordable after the expenses-based calculations.
Do not be surprised to see people around you enjoying the fruits of labour with the luxury lifestyle yet has little to no coverage on their own life. It is never too expensive to plan out a substantial coverage to your current life phase unless you are exploring it the wrong way.
The insurers or financial planners would be able to work around your budget and offer a solution that best fits your needs.
Insurance plans are definitely important commitments that we have to set aside to ensure that our futures are being protected.
So instead of passively worrying how much we have to pay, consider approaching the insurers now and get the exact figures so that you can plan more accurately.
Alternatively, we can use Insurance Choice comparison feature to help us identify some of the possible choices on our selections to create a portfolio before we approach any insurance agent.
Need help managing your finances? Insurance Choice’s goals are to educate our viewers to be financially prudent by providing them the correct platforms to achieve their financial goals and to ensure that they are insured at all stages of their lives.