Personal Insurance Choices: Life Insurance
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Choosing the Right Personal Insurance for You
I guess I am at that age where mortality is suddenly an issue. I have assets and children to consider. I am not as fearless as I once was. And, I have no will, life insurance or income protection insurance. I am a single mother and now I worry about the "what happens if..." scenarios.
Life and income protection insurance products provide funds when someone experiences an illness, injury or premature death, stopping them from earning an income. Most life insurance policies pay an agreed lump sum in the event of death or terminal illness, and income protection insurance covers a percentage of salary when you are temporarily unable to work due to sickness or injury.
So, do I need this? I think I do.
Life and income protection insurance products provide funds when someone experiences an illness, injury or premature death, stopping them from earning an income. Most life insurance policies pay an agreed lump sum in the event of death or terminal illness, and income protection insurance covers a percentage of salary when you are temporarily unable to work due to sickness or injury.
So, do I need this? I think I do.
The Game of Life
We have a great new infographic on The Game of Life - revealing some interesting misconceptions and myths about life insurance & income protection.
Finding the best life insurance
Experts on Finding You the Right Life Insurance
No matter where you are in the Western world you are likely stumped when reviewing how many types of life insurance policies there are and who offers them. Then there are all of the options and prices. In Australia, Lifebroker compares the leading life insurance companies to find your ideal cover. Choose your level of insurance coverage, and find out more about personal life, trauma, disablement and income protection insurance. Lifebroker is a free service - you only pay the life insurance or income protection premium that you choose.
I highly advise that where ever you are located that you do find similar services such as this to help make your decisions on personal insurance easier. To help you along I have found a few links that offer a similar service:
USA:
Term Life Insurance, Instant Quotes and Comparisons
Get instant term life insurance quotes from top life insurance companies. Compare term life insurance quotes online and choose the policy that is right for you.
Term life insurance comparisons - over 100 companies to compare
The most unbiased term life insurance comparisons because Term4Sale does not sell term insurance.
UK:
Compare a Life Insurance Quotes
Compare a life insurance quote with cover starting from 17p per day. Life Insurance comparison for UK policies, find the best premiums and compare features.
If you have used a service that you've found helpful, let me know and I can create a helpful list for other users!
I highly advise that where ever you are located that you do find similar services such as this to help make your decisions on personal insurance easier. To help you along I have found a few links that offer a similar service:
USA:
Term Life Insurance, Instant Quotes and Comparisons
Get instant term life insurance quotes from top life insurance companies. Compare term life insurance quotes online and choose the policy that is right for you.
Term life insurance comparisons - over 100 companies to compare
The most unbiased term life insurance comparisons because Term4Sale does not sell term insurance.
UK:
Compare a Life Insurance Quotes
Compare a life insurance quote with cover starting from 17p per day. Life Insurance comparison for UK policies, find the best premiums and compare features.
If you have used a service that you've found helpful, let me know and I can create a helpful list for other users!
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Making an Informed Choice
Why Choose Personal Insurance Products
For some people, just contemplating life insurance can be confronting; like I said it is a mortality check. We should be considering the things that are most important to us - family, health, home and financial security. Life insurance is less about planning for disaster, and more about guaranteeing a positive future. Important!
When considering how much life insurance it is important you choose the right level of cover for you and your family's needs. Think about your financial commitments and how long they last, taking into account the following factors:
- Any debts you have
- Your children's future education costs
- How much an ongoing income stream would cost
- Providing for any major future purchases
The Cost of Life Insurance
Overestimating the cost of life insurance is dissuading buyers of insurance
And you 'd be surprised to find how underinsured we are.
When non-insured persons were asked to estimate the annual cost of a life insurance policy for a 40 year old non-smoker, 40% were unable to provide an estimate, while those who provided an estimate overstated the cost by between 49% and 65%.
Q. What do you think the annual premium would be for a one million dollar life insurance policy for a 40 year old non-smoker?
49% of males overestimated the cost
65% of females overestimated the cost
Reference: Life Insurance Report
When non-insured persons were asked to estimate the annual cost of a life insurance policy for a 40 year old non-smoker, 40% were unable to provide an estimate, while those who provided an estimate overstated the cost by between 49% and 65%.
Q. What do you think the annual premium would be for a one million dollar life insurance policy for a 40 year old non-smoker?
49% of males overestimated the cost
65% of females overestimated the cost
Reference: Life Insurance Report
Life Insurance Premiums
What is a life insurance premium?
A life insurance premium is the price that you pay (monthly, half-yearly or yearly) for your insurance.
If you take a life insurance policy, it will provide your nominated beneficiary with an agreed upon lump sum payout, in the event of your death.
Then, what's the difference between stepped and level premiums?
Stepped premiums increase each year as you get older; the amount they increase each year will depend on age.
From age 20-30 little if any increase each year
From age 30-40 average 6% increase each year
From age 40-50 average 8% increase each year
From age 50-60 average 11% increase each year
Above age 60 average 15% increase each year
Please note that this is a guide only in regard to annual increase and actual increases can vary depending upon a range of factors.
This means that as you get older the insurance premiums can get quite high, but there is one way of avoiding this, level premiums. Level premiums are where the premium will remain constant up to age 65 so long as the cover remains constant. Level premiums may be higher now, but over the long term they are significantly cheaper.
Always request quotes on stepped and level premiums when they are available.
If you take a life insurance policy, it will provide your nominated beneficiary with an agreed upon lump sum payout, in the event of your death.
Then, what's the difference between stepped and level premiums?
Stepped premiums increase each year as you get older; the amount they increase each year will depend on age.
From age 20-30 little if any increase each year
From age 30-40 average 6% increase each year
From age 40-50 average 8% increase each year
From age 50-60 average 11% increase each year
Above age 60 average 15% increase each year
Please note that this is a guide only in regard to annual increase and actual increases can vary depending upon a range of factors.
This means that as you get older the insurance premiums can get quite high, but there is one way of avoiding this, level premiums. Level premiums are where the premium will remain constant up to age 65 so long as the cover remains constant. Level premiums may be higher now, but over the long term they are significantly cheaper.
Always request quotes on stepped and level premiums when they are available.
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Handy Links for Insurance Quotes
Free Online Quotes
Lifebroker will help you to find the best insurance coverage from Australia's leading life insurance companies. Lifebroker is a free service - you only pay the life insurance or income protection premium that you choose.
- Income Protection Quote
- Income Protection will cover a percentage of your salary for a period if you're temporarily unable to work because of sickness or injury (anything not allowing you to continue your work).
- Life Insurance Calculator
- Our free life insurance calculator can help you determine how much life insurance you require with a simple calculator interface.
Lifebroker Twitter Feed
See the latest tweets from Lifebroker!
Insurance Policy Uptake
Are you underinsured?
Most people are significantly underinsured when it comes to life insurance and income protection insurance. Uptake ratios for life and income protection insurance fall well below those for car/home and health insurances.
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Have tips on selecting personal insurance policies?
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marquejohn
Apr 6, 2012 @ 5:08 am | delete
- Companies that offer permanent life insurance quotes will most likely honor the premium costs and coverage terms throughout the lifetime of the insured person but the person's life may change in such a way that changes to a life insurance plan are in order.
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RetiredRebel
Nov 28, 2011 @ 1:22 pm | delete
- I like this lens. Is really well written :)
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laureencownie
Oct 24, 2011 @ 3:20 am | delete
- When you consider getting a life insurance, it's always recommended to learn and understand the different types of insurance (Term and Permanent). Then assess and evaluate your family needs. Then you should gather as many life insurance quotes from at least 4 - 5 reputable insurers as possible and carefully compare them.
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Christian
Oct 17, 2011 @ 9:49 pm | delete
- One tip I can give when selecting any type of insurance is that get at least 3 reputable insurance companies and compare the quotes you get from each them. This is to make sure that you can get the best deal and plan for you.
income protection insurance quotes
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lifebroker-australia
Oct 17, 2011 @ 10:53 pm | delete
- Couldn't agree more. With services such as yours (and ours!) we can make this process much easier for the consumer!
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- Research was commissioned by Lifebroker to improve understanding of the underinsurance issue in Australia, including the extent of underinsurance and its causes.
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Our reading picks
If you would like more information on insurance products
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by lifebroker-australia
We specialise in the comparison of life insurance products, this is all we do. There are too many options, and life insurance is too important. You do... more »
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