MIWAYLIFE BLOG
11 Jan 2022
Having a policy that grows with you and can adapt to the changes in your life is one of the features that come with life cover. The cover amount is one of the aspects in which you can ask your insurer to change to make sure you have enough cover.
Understanding how increasing or decreasing your cover can also prepare you for the changes it will cause to your policy is important. Here is what you need to know.
What is a cover amount?
A cover amount is an amount an insurer quotes you when it comes to how much life cover you will need to take care of your needs. For example, MiWayLife can give you life cover to the value of R500 000 - R5 million to make sure that you and your loved ones are covered. It is also the amount you will receive when you place a claim.
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Can you increase or decrease your cover amount?
Yes, it is possible to increase or decrease the cover amount on your life insurance policy to create a safety net that will protect you. You will be quoted on what is affordable for you, but you can choose to increase the cover amount should you feel that you can afford to increase your cover. Decreasing your life cover amount could mean making changes to your lifestyle choices that can impact your premium. You can also consider choosing an insurer who will cover you for less. Remember that cover amounts can differ from insurer to insurer.
Will it affect your policy?
There are many reasons why you will want to increase your cover amount. Creating a larger safety net that keeps up with your lifestyle, starting a family or making sure that you are covered for any of life's curveballs are just some of the reasons. Increasing or decreasing the cover amount will impact your premiums. You are likely to pay a slightly higher premium the more you increase your cover. You can use a life insurance calculator to see if your current policy is enough to cover you.
What should you keep in mind?
Before choosing to change the cover amount on your policy, factor in the annual increase that is placed on most policies to see if you will be able to maintain your payments. The last thing you want to happen is having to cancel your policy at a time when you may need it the most. You can always go back to update your policy to make sure that it is enough to cover you and your beneficiaries.
