Beyond Mortgage Protection
Many of us only consider life insurance when taking out a mortgage. However mortgage protection only lasts for the term of your mortgage and won't cover any further costs your family will experience in the event of your death.
First things first
To be fair, why would you think about life insurance before taking out a mortgage? Taking out a mortgage is usually one of the milestones in your life that really makes you think about the future. But the most important things are mortgage repayments, home and mortgage protection insurance for the bank... everything else can wait!
It may not be something you like to think about but why wait until the later years to look at personal life insurance? When your mortgage is paid off you have more disposable income and you have gained back the money that you put aside for the mortgage each month so why wouldn't you look at the costs that become more apparent as you get older?
"I agree, I am in my 30's and I would never have thought that life cover is so important right now, I have plenty of years ahead of me to do that! In 35 years, when the mortgage is paid and money isn't as tight, I will have an opportunity to look at life cover. This is an ideal time, I am getting older and I don't want to leave my kids with my funeral costs, lets do it then!"
These are the comments and views that our customers express to us on a daily basis and you know what... they are right in a way. To ensure that there is a death benefit that will go to their family, they are missing the most vital part. When they are older they will pay 6 times more than a 30 year old for the same amount of life cover!
This is a message that is difficult to deliver to our customers but something we feel we need to educate people on, so don't wait too long!
Breaking it down for you
Today, a healthy 30 year old will pay €10.10 per month for €50,000 of life cover and a healthy 60 year old will pay a minimum of €60 per month for the same cover (6 times the amount). The one thing that hasn't been factored in yet is health. A 30 year old might avoid a GP at all costs. €60 for antibiotics? No thank you! They are usually lucky enough to be healthy and fit. A 60 year old could have many more years of medical history that can be extensive or quite small but is still likely to impact their premium. So 6 times the premium might turn into 7 or 8 times more.
As unfair as it might sound, and I do sometimes agree with customers when they get an increased premium but it is like health insurance, pre-existing conditions are looked at and factored in. The life insurance companies try to be fair and they do their best for our customers but it is their job to assess risk.
What does this mean?
This means that policies can turn out to be much more expensive than they would have been had a person thought about applying when they were younger with less visits to the GP.
We often hear young people say:
“I’m young, healthy and have no dependents. Why would I need life insurance?”
This is the mind-set that a lot of people have when they are younger. Taking out life insurance policies is much easier when you are young and healthy. You can get a lot more cover for much cheaper when you are young.
It's not all high premiums though, we work with our customers to keep things affordable. We try and get clients to consider their insurance sooner in life. Even a 50 year old will see a massive saving if they don't wait another 10 years to apply.
We'll take it from here
Planning for your future and your death can be a scary thought but the earlier you start thinking about it, the more cover you will be able to afford and the better it will be for your family. For more information check out our blog on reassessing your life cover and our checklist for taking out life cover. Alternatively, you can give us a call on 01 400 3434 or get a quick quote above.