Living without life insurance is simply a gamble for most people. Almost everyone has debt and most of us have families who would have to struggle financially if we were not there to help provide for them. You can avoid these worries and gain great peace of mind with the right life insurance policy. Before you begin looking, take a moment to learn about the different types of life insurance so you can make an educated decision when it is time to purchase a policy.
There are three primary categories of life insurance policies available in South Africa. Term life insurance is your least expensive option. Cover is provided for a certain amount of time (term). Decreasing term insurance is the most popular form of this cover. A great option for families, this cover can be linked to specific debt such as a home loan. As the debt decreases, so do the premiums. If a term life policy is not linked to a debt obligation, payouts can be used for any purpose. The policy can be renewed at the end of the term, but the premiums will be higher upon renewal.
If you want to secure financial security for your family in the event of your death, then whole life insurance may be a good choice. Whole life insurance is synonymous with permanent insurance which covers you for as long as you pay the premiums. While these types never need to be renewed, one benefit is the premiums remain the same, no matter what age you are. While whole life insurance policies usually cost more then an equal amount of term insurance, due to an average premium cost. Some policies will even include a savings option that you can borrow against if the need arises
Amongst the life insurances that do not renew and neither do their premiums adjust is Universal life insurance. Universal life insurance is unique in that unlike whole life policies, this kind of insurance offers other financial services, for example savings and investment policies. You can return the policy and claim your accrued savings. The policy holders can however incorporate another person into their policy, take care of their investments or use their funds to cater for premium payments. All this uniqueness makes universal life insurance the most exorbitant cover choice.
South Africa is one among the two countries in the world which is offering an insurance package to the AIDS patients. The equated payments for this type of insurances will be more than the normal payments and the insurer also wants the insured to undergo some antiretroviral treatment.
If you want to have a set of policies for you and your family, the best way is to ask yourself a set of 3 questions.
Premium payments! What are they? and what if i miss one?
How much is the death benefit for this life cover? Will that be enough benefit my family?
The question is: will this policy be the best one to serve my needs? What sort of coverage will it provide me?
Life insurance is an important component of your family’s financial protection plan. Purchase a good policy and you will be able to protect your family from financial ruin if anything should happen to you. Your loved ones will be able to maintain their lifestyle even if you are no longer there to support them. Both you and your family will have peace of mind if you get a good life insurance policy.
Article Source: LifeInsuranceLine.info
Tom Martens is the content syndication coordinator at Lifeinsurance-Southafrica.co.za South Aricas leading Life Insurance and Life Cover portal.