Curious about life insurance but unsure where to start? MetLife is here to help. Ever wondered “What do I need to know about life insurance” ? Here we look at five things you might not have known about life insurance, including how your needs change, what the different premium types are and more.
1. There are two different types of premiums
There are two types of premiums. You need to consider the best type of premium for your current needs, as well as your future needs.
The first type is a stepped premium. These can be popular among young people as the premiums start low and increase over the years. But those considering a stepped premium should consider if they will be able to afford the increasing premiums as they get older.
Level premiums can change over time but the increase isn’t affected by one’s age as stepped premiums are. Level premiums will cost more to begin with but can end up saving you money if you plan to hold the policy for the long term.
2. You should think about more than your mortgage
It makes sense to have life insurance cover that will pay off any housing-related debt so your family has a roof over its head. But there are other things you may need to consider, such as paying school fees, having enough money to go on holidays, or leaving enough for kids’ wedding expenses and uni fees.
3. Sometimes you need less coverage
As you get older and move through life’s stages, you may need less life insurance coverage. This is because as you head into your golden years you may have paid off the house, might not have kids at home and could have investments that provide a steady income stream for you and your partner.
4. You should regularly review your cover
Your life insurance coverage is a conversation you need to be having every year. Life moves and changes fast, and you need to make sure you have the coverage you need at your current stage of life – not where you were last decade. Make a regular appointment with a financial adviser and review your benefits and premiums.
5. Don’t just rely on the insurance cover inside your super
Most super funds provide life insurance, but you need to carefully review whether that coverage is enough to provide for your family. Call your fund and find out what the benefit is, and then talk to your financial adviser about whether it’s enough for your needs.
To learn more about making the right choices with life insurance, read our blog: What is life insurance
