Taking out a life insurance policy may not be one of the most exciting purchases you will ever make, but it will be one of the most important.
It is something that is created to grow with you and offer cover for you and your loved ones. While the golden rule is to take out a policy while you are still young and healthy, the question is - is it worth it?
The benefits of life insurance
Knowing what you will be getting out of having a policy will help you assess if it is something worth pursuing. While policies may differ from insurer to insurer, the common benefits are:
Creating a reliable safety net. It can act as a financial shield against some of life's unexpected expenses such as being diagnosed with a terminal illness like cancer which can cost a minimum of R10,000 - R1 million a year. It also ensures that your loved ones will be covered to continue to support their lifestyle and daily expenses when you pass on.
Peace of mind. We may not know what tomorrow holds, but life insurance can give you peace of mind knowing that you will be financially protected to ensure that life doesn't stop when you become ill or die. It can be used to take care of debt, educational expenses and other living expenses without you having to stress who will take care of these.
Offers protection for your family. Whether you are planning on having a family one day or are currently the breadwinner, life cover offers peace of mind knowing that the people you care about will be taken care of no matter what happens to you.
Handling medical costs. One of the living benefits that come with a life cover policy is the payout for terminal illnesses to assist you in paying for medical costs such as medication, a live-in nurse, transport, and renovations to your home without getting into debt.
When will be the right time to take out a policy?
The best time to take out a policy is while you are young and healthy, making your policy affordable. You still have the option of purchasing it at a later stage, but keep in mind that this can affect your premiums. There is also a limited time frame in terms of age which most insurers are willing to cover you for. It may become difficult to find an insurer who will cover you after the age of 65 as they will see you as a high risk. The right time to buy life insurance is when:
You are planning on having a family
You are the breadwinner or have people dependant on your salary
You are still in the process of building your savings
You have accumulated any debt
You are planning on buying a home or own a home
You are self-employed and looking to create a financial safety net
You want to financially protect your partner regardless of whether you are married
What if I don’t have any dependants?
Even if you do not have children that rely on you financially, you may have a family that you wish to protect financially. This could be an adopted family that you would like to protect, a charity that you would like to donate to one day, or a social cause that can benefit from your policy. If you are planning on having a child in the future, then it’s also important that you have a life insurance policy in place.
Things are forever changing, and we all need something that can adapt and grow with the changes in our life. You can use our life insurance calculator to assess how much life insurance you will need.