Although many people never need to cash in their policies, the ones who do are immeasurably grateful for the option when the time comes. This is particularly true of life insurance. It’s not something we like to think about, but having a lump sum payout can make a huge difference to the people you leave behind if the worst does happen.
All too often, people believe that life insurance is only for the wealthy when life insurance policies can actually make a huge difference to people from all types of financial background. If you’re currently considering taking out a life insurance policy, here are a few reasons why this type of insurance could be suitable for you, no matter how big or how small your bank balance.
The benefits of life insurance
The main benefit of life insurance is that it provides your chosen beneficiaries with a cash pay out in the event of your death. This money can be used to cover funeral expenses, meet mortgage repayments, and provide a financial cushion for your loved ones at a very difficult time.
In many cases, having a life insurance policy in place means that families are able to remain in their homes, or even buy their property outright, in the event of a policy holder’s death. This can provide invaluable financial security at a very important time in the lives of your loved ones.
How much does life insurance cost?
As The Balance says, “The first thing you need to know about life insurance is that the younger and healthier you are, the less expensive it is.” In general, the older you get, the more expensive your premiums will become. This is because the chances of developing a serious disease or condition increase the older you are, something that makes it more likely your insurer will have to pay out.
Some insurers will ask applicants to take a medical test before they agree to coverage. This is to ensure that the policyholder is in good general health and is done to minimise the chances that the insurer will have to pay out. If you’re a smoker, drink a lot, are overweight, or have a long term health condition, there’s a good chance you’ll have to pay more for your policy.
Types of life insurance
There are a number of different types of life insurance you can choose from when selecting your policy. While some will cover you for your entire life, others are limited to set periods. If this period expires without your policy paying out, you’ll need to take out a new policy if you want to stay covered. The type of insurance you choose will depend on your circumstances. Talk to an expert advisor before you decide which type of cover is right for you.
For expert financial advice, and to find out more about the life insurance policies available, take a look around our site or get in touch with a member of our team.
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Written by: Editorial Team