If you are thinking of getting life insurance, or you need to reassess what you have, you may find yourself floundering through some terms and terminology that you don’t fully understand. Or perhaps a you’ve been feeling apprehensive because you don’t know where to start.
Most people talk to a broker to untangle the jargon and get some advice, but perhaps you want to do a little homework of your own.
Do you really need it?
Logically, if your life insurance policy only pays out on your death, then it’s not much use to you. However, if you have a family or someone who is dependent on you for financial support, then it is definitely something to consider. Even a non-working spouse would leave the financial burden of child care to their partner, so weigh it up realistically.
How much do you need?
Your needs and those of your family are very specific. So you need to establish how much support each person will need, and for how long. This will give you an idea of how much insurance you will need. A simple sum is to calculate the financial needs of each person annually, and then multiply that by how long they will need the support for. Obviously, you can’t factor in any economic disasters or currency fluctuations, but it’s a good jump off point.
What sort of product do you need?
There are a number of life insurance options available in today’s market. For example, would you need term life, whole life or universal coverage? Could you benefit by linking your payments to an investment vehicle?
As with most things, information is freely available online for you to do your homework.
However, it’s always worth spending some time with an independent broker who can work out your specific needs and explain what the various options mean. If you don’t want to leave anything to chance and would like a call from an independent broker who knows his stuff, then contact us and we can unravel the mystery for you.