Life Insurance - How to choose your ideal Life Policy
"Your guided journey through the world of life insurance starts here"
No one knows when their line is drawn, when their days are up and the fine sands running through the hour glass come to an end. Life is a precious thing, and when you have a family depending on you, your death becomes their loss in more than just an emotional sense. For some of us the thought of dying is not something we have given time to. After all when you are in the prime of your life, the part of your life where you should be thinking about a life insurance policy, death is about as far away from our thoughts as old age is.
But none of us knows when our time is up, when Death will come for a first and final visit. This is the reality we have all faced from the day we came into this world. And while death is life’s grand finale, there are a few things that you can do to lessen the blow of your passing and you can start with a life insurance policy.
5 Tips How to Save on your Life Insurance!
- Put down the Cigarettes
- Maintain Good Credit Score with your insurer
- Live healthier
- Continuously ask for Discounts on your life insurance
- Shop Around for the best deals
- Don't do to risky activities
Only 6% of all South Africans has life insurance!
What is life insurance and why is it so important to have?
- The moment we reach adulthood, we start accumulating expenses and some of these expenses are really a burden. We begin the building of debt that might hang over our heads for some 20 years or more. It doesn’t matter how optimistic you are about living until you are 80, we do not have control of when we are going on our next great journey. And being prepared for all types of eventualities doesn’t mean that you have to be less optimistic about your future. Rather it will mean you have planned for your future, and the future of your family, in the most responsible way.
- Life insurance is a policy that is designed to pay out a certain amount of money when you die. You can choose to whom the money will go and then pay monthly premiums, like any other insurance, towards the final amount that will be paid out. Unlike other insurances that will pay out according to the damage done, you decide how much you would like to be covered for.
What is life insurance and why is it so important to have?
The moment we reach adulthood, we start accumulating expenses and some of these expenses are really a burden. We begin the building of debt that might hang over our heads for some 20 years or more. It doesn’t matter how optimistic you are about living until you are 80, we do not have control of when we are going on our next great journey. And being prepared for all types of eventualities doesn’t mean that you have to be less optimistic about your future. Rather it will mean you have planned for your future, and the future of your family, in the most responsible way.
Life insurance is a policy that is designed to pay out a certain amount of money when you die. You can choose to whom the money will go and then pay monthly premiums, like any other insurance, towards the final amount that will be paid out. Unlike other insurances that will pay out according to the damage done, you decide how much you would like to be covered for.
Most companies offering life cover are going to offer life insurance policies that are affordable and negotiable. This is because your life cover needs to be able to suit your needs. If you, for example, have a lot of debt you will probably have to take out a larger life insurance policy to ensure that everything is covered in the event of your death.
To get right to the bottom of life cover you are not going to be seeing the money once it comes time to pay out. Unless you are buying an endowment or annuity policy, which can act as a life policy and a retirement policy, you are saving up for someone else’s peace of mind, for someone else’s future.
While basically this is what life insurance is, there are more facets to the life cover that need to be explored. Read down further to find out about the types of life insurance.
"Types of life insurance"
Before you can decide on what type of life insurance you need, you will need to decide how much life cover you are going to need. Then once you know how much life cover you will need, you can start shopping around for life insurance quotes. But to assist you in your decision making, here are the types of life insurance that you will be able to sign up for in South Africa.
Term Life Insurance
When we talk about term life insurance we are talking about life insurance that will only last for a fixed term meaning a predetermined time. This type of insurance is usually taken by those who are only going to need insurance for a specific period of time. These types of policies can be purchased for time periods of 10 years, 15 years or 20 years.
These are perfect to have over certain periods of your life to give your family financial cover if you are, for instance, paying off your loans. While these life insurance policies are very useful to have, you will not get the money back after the time period is over. Once the term is over your cover will stop immediately. But should you pass away during the time period, the policy will pay out.
Whole Life Insurance
This type of insurance is going to guarantee a pay out in the event of your death. With this life cover you will pay for the policy every month until the date of your death when the policy will pay out to your nearest and dearest. When a policy holder has paid for their policy for long enough they will be able to borrow money against the policy and premiums will usually be higher than your term life insurance.
Universal Life Insurance
This type of life insurance will give you a policy along with an investment option. With every payment you make, another amount will be credited to your insurance account. That added amount will earn you interest each month so with this type of policy you will have the possibility of rapid growth on your investment.
Knowing the different types of life insurance is a great starting point in building up your knowledge regarding your insurance. The next place to dig in will be to know exactly why you need this type of insurance.
The importance of having life insurance
You might be one of many people who are reading this and thinking, what is the point of life cover if I am never going to see that money. And it is a valid question to ask if you are paying each month for your insurance but you know that you will never be seeing that money. Here are a few of the valid reasons why you need to have this insurance.
You have no control over your future
You can climb into your car after reading this and be driven into and killed by a reckless driver. No one wants to consider this ending but none of us have control over how we will meet our makers. And most of us have a family. Should you die suddenly tomorrow but you have life insurance, your family will be taken care of in more ways than one. While you can never be replaced, your family can benefit greatly by this extra boost.
Your death shouldn’t carry debt
We take it for granted that the bill collectors will stop coming after we are gone, but while you might not have to suffer their collections your loved ones are likely to have to carry your debt. Is that fair on them? Especially while they are having to deal with the trauma and upset over losing you? Having life insurance will mean that your debts are covered after you die.
Donate to charity
There are those among us who have a charity that they have supported throughout their lives and wish to leave a donation for once they have passed on. Having life insurance can mean that in death you can make that generous donation to a charitable cause that you weren’t able to make in life. Quite a generous way to be remembered.
It can give your retirement a boost
Not all life insurance policies are only designed to pay out upon your death. There are some that can pay out upon death or pay out as a retirement policy. Many people rather prefer this option as it means that a lifetime of paying for life insurance will result in them seeing their investment when they reach the age at which it will pay out. These policies are known as annuity and it will guarantee an income for you once you have reached retirement age.
It gives you peace
There are no ways to predict when life will end or what life is going to through at you, such as sickness or disability. While one certainty is that you will pass on, and no money will ever be able to replace the value and love you brought to people’s lives, having a company insure you for life cover is one step towards building a financial safety net.
Having life insurance is an option and it is one that you will not regret having. For many reasons it is going to give you peace of mind. Now that the importance of having such cover is out of the way, we’re going to get down to the next bit of important stuff. Just what factors are going to be having an effect on your cover?
Did you know that 1 in 2 people can save on their life insurance simply by living a healthier live!
The biggest factors affecting the life insurance rates you will pay
For something that you are going to be paying for the rest of your life it is important to have an idea about what is going to be having an effect on the monthly rates that you are going to have to pay. Life insurance rates are, let’s face it, a large part of what is going to assist you in making the decision regarding which insurance cover you go with. Here are the factors that are sure to have an effect on the life insurance rates for the different types of life cover:
- Your age. Using your age to determine your rates is nothing new to insurance, in fact car insurance companies will also use your age to determine your monthly rates. With life cover the younger you are, the less you will pay. But should you buy a life policy later in life, you can expect to pay out more.
- Your health. If you are seriously an unhealthy person, you can expect to pay out more for your insurance. This is because your health can make you a risk for the company. Staying healthy and free of problems is the best way to keep your insurance rates low. Your current health and the history of your health, such as if you have had a heart attack in the past, will also be used to determine your rates. Your weight is also going to be playing a role.
3. Your occupation. If you are a bomb disposal expert the chances are you will be paying massive premiums on your insurance. What you do for your day to day living is sure to have a big impact on the monthly rates you will be paying.
4. You are a smoker. Sadly no matter who much you love those cigarettes, your insurance is going to be affected by your smoking. The good news is that if you have been planning to quit you really have a good reason to now. Within a year of quitting you can drastically lower your insurance rates.
5. You like to drink. Almost everyone enjoys the occasional drink to unwind but if it becomes a bad habit and you start consuming too much, you must expect to pay up with your insurance. Those who enjoy more than the occasional drink are sure to end up paying more for their life cover.
6. Your gender. According to research and numerous studies, women tend to live longer than men. This means that with some insurance companies, women will pay less than men.
7. Your family. Looking back into your family history, how healthy have your ancestors been? Some of us are naturally prone to cancers, bad heart conditions and other life threatening illnesses. As a result, if you are one of those people who come from a long life of sick people your insurance premiums are going to be a little higher.
Having affordable life insurance with the best life insurance company is a great idea and part of the most important insurance cover you can have. And finding the best life cover that is affordable and effective does not have to be as much of a mission as you imagine. At Insurance Directory we have made finding life insurance quotes simple and as easy as doing a quick search, selecting a company and then requesting a quote. Our free to use insurance directory will give you the opportunity to find the best types of life insurance at the most affordable rates.
5 more Tips on Saving on your Life Cover Premium
- Pick a suitable policy
- Get the right sum insured
- Consider joint life cover
- Buy life insurance when you're young
- Pick a suitable policy