Another Day Without Life Insurance? You’re Rolling The Dice

If you’re still not covered… Lifecare explains why life insurance and critical illness cover needs to be moved to the number one spot in your 2020 budget.

We need to learn our lessons from COVID-19.

Living for tomorrow has always been a gamble, but the pandemic has made us realise just how much we roll the dice.

The uncertainty of the future shouldn’t keep you up at night. Life insurance and critical illness cover are specifically designed to remove the burden of how your financial obligations will be met should you no longer be able to meet them – freeing your mind to truly enjoy each day as if it was your last.

Yes, it comes at a cost, but when $750,000 worth of coverage for a 40-year-old healthy male comes in just over $5 a day – or a takeaway coffee – the priority becomes clear.

While the world pauses to reflect, reevaluate and reorder its objectives, life insurance and critical illness cover needs to move from a consideration, to an absolute necessity.

Who Has Life Insurance?

The US Life Insurance Marketing & Research Association (LIMRA) released alarming statistics earlier this year to confirm that 43% of American adults did not have life insurance. In the UAE, that number is even higher, with 51% of adults admitting to not having cover in place in the most recent study conducted by Friends Provident and YouGov in 2018.

Who Needs Life Insurance?

As a rule of thumb, life insurance is a necessity for anyone with dependents and/or debts. If anyone will suffer financially if you were suddenly not around to support them, or if they would inherit your debts, it is vital you have provisions in place. We often limit this safety net to include a spouse, children, ageing parents or family members, but it’s also important to treat business obligations, properties, loans and credit cards with the same compassion.

What Age Should I Have It In Place?

It is unusual for a young adult in their 20s to give ample thought to life insurance, but this is actually the best time to start your term cover. There are several individual factors that determine the cost of a life insurance policy (including high risk professions or sports activities) but generally speaking, the younger and healthier a person is, the less they can expect to pay. It is also worth considering that levels of disposable income are often higher before marriage, children and the resulting family finances become a factor.

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Critical Illness Is Not An ‘Extra’

It is a common misconception that critical illness cover is an added extra to a life insurance policy, and therefore a disposable option to push down the financial impact of your policy. But the outcome of critical illness is often the same as death – i.e: the inability to support dependents and debtors – and the two should most certainly be considered equal partners. In terms of cost, a healthy 35-year-old female can obtain more than $270,000 worth of critical illness coverage for just over $3 a day, or $90 a month, which is comparable to one manicure/pedicure.

There really is a level of life insurance and critical illness cover to suit every budget. Speak to our financial planning team to find out the protection available to suit yours.

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