Having life insurance is an important financial safeguard for our family and loved-ones if the unexpected occurs. While discussing life insurance can be a sensitive topic, without some planning for the unexpected it could be incredibly difficult for many families to maintain their current standard of living.
The idea of life insurance is to provide financial security for your dependents if you die. Generally, the policy will be expected to clear the mortgage and significant debts, and provide a nest egg for the family.
There are many policy options and ways to purchase life insurance. You can go direct either online or over the phone, buy through your super, or talk to a financial adviser to arrange your insurance.
Purchasing life insurance involves making decisions such as choosing which cover level is suited to your needs and which benefits you should consider. The options and range of policies available can sometimes seem complex.
So what are the ways to select and purchase a life insurance policy that is suitable to your circumstances?
Online and over the phone does offer convenience, often with minimal or no medical information required, and the approval process can be immediate. When comparing insurance policies online, it is important to do the research and ensure you understand exactly what is included and excluded in each policy.
Direct life insurance may be quick to arrange, but you may be less able to select and tailor a life policy that suits your needs.
Also, if you do decide to purchase life insurance direct be careful to understand any policy exclusions before you sign up. Some direct life insurance policies reduce the amount of cover as you age whilst others exclude from cover any pre-existing conditions at the time of applying
Often the cover provided by direct insurance has lower payouts than a policy arranged through a financial adviser.
It’s very important to read the ‘fine print’ with any insurance policy, but it’s especially important with a direct product, if you don’t have the financial adviser there to assist with your decision. An important benefit of using a financial adviser is that they do the research for you and choose suitable cover for your situation and to help you to receive a payout should you need it.
Most people seem to think buying online is cheaper, but this is not necessarily the case. The tailored life policy through a financial adviser can be more economical and better value for money, with the added benefit of confidence that the policy is more likely to be suitable to your circumstances as your adviser can look at your personal situation and find the most appropriate policy for you.
Most importantly, if something happens the financial adviser will be there to provide valuable assistance through this difficult period by assisting you to receive the insurance payment in a timely manner.
If you are thinking about insurance options available, contact us today to discuss your circumstances and life insurance needs.
RI Advice Group Pty Limited (ABN 23 001 774 125), Australian Financial Services Licence 238429. This editorial does not consider your personal circumstances and is general advice only. You should not act on the information provided without first obtaining professional financial advice specific to your circumstances.