Posted in Insurance

You Really Do Need Life Insurance And The Earlier You Take One Out The Better Deal You Will Get

Like most young Australians starting out in life the world is your oyster. Living in a land with a glorious climate and a good education and vocational training system which enables you to find a decent job and start enjoying life. And is there a lot of life to enjoy; from surfing to skiing, from sailing to playing one of the many sports at which All Australians excel and are proud.

So why would you ever even consider purchasing Life Insurance. Yes that is right. You wouldn’t.

But it is suggested that you think very carefully about taking out a policy sooner rather than later.

The reasons are manifold and here are a few for you to consider; At some stage hopefully you will get married and start a family. The earlier you start with a policy the better the coverage will be and your family will be protected should anything happen to you. How often do you read of horrific accidents where there are multiple deaths and families are left devastated and destitute, even though the deceased was in no way responsible for the accident.

And it doesn’t have to be by car, You may fall overboard on a yacht race or fall off a horse. And this is just accidental death.

The fact that we Aussies live in a wonderful climate does not exempt us from getting ill, Heart attacks, cancers and other illnesses also manifest themselves in Australia and the effect on the family will be just as devastating. In fact maybe worse. So it is suggested the younger and healthier you are the better odds you will get in taking out a life insurance policy.

There are many types of policy depending on what you want to do. The simplest form of Life Insurance is a straightforward bet. You bet against the insurance company that you won’t die before you turn 65 (say). The actuaries, who are guys with massive mathematical ability take all of the factors they can think of into account and give you odds on this bet. So if you are a young healthy 20 year old who is going to work in a non hazardous environment, your policy is likely to be a lot cheaper per AU$100,000 than if you were 30 years old, a heavy smoker, was overweight and working as a coal miner..

There are many other types of life insurance policies, some which will cover you and for which, after 25 or 30 years of premiums will pay you out a lump sum or an annuity, which is a regular payment every year until you decease or similar. These types of policies seem attractive as the value added sounds fantastic but before committing to one of these policies check out the small print as well as whether the amount promised is going to be worth that much is inflation is 5% pa for example.

There are other policies which offer income protection in the event of a disabling injury for example.

All of these are pertinent and it is advisable to consider life insurance as early in your career as you sensibly can.