Insuring your life in South Africa is very important. But how much is the life insurance coverage required is a very difficult question to solve. To find an answer, you have to ask a few questions to yourself. You have to ensure that you are choosing the right type and the right amount of Life Insurance. Also, you can compare the Life Insurance policies available in South Africa on our website.
The first question that needs an answer is whether you actually need Life Insurance. Life Insurance is beneficial and essential, but not everyone necessarily needs it. Say, if you do not have any dependents, you can afford to exclude Life Insurance from your financial plan. But if you have a family who depend on you, then you shouldn’t think about excluding Life Insurance.
When buying Life Insurance it is also crucial to look at the risks that you have. Life Insurance companies prefer people with fewer risks. So, if you wish to get an insurance policy with a cheaper rate, you should have a good and healthy life style. Age is another major factor to be considered. This means if you purchase the policy at a younger age, you will be paying lesser compared to an older person. So, starting the policy early and maintaining a healthy lifestyle are the keys to get cheaper life insurance in South Africa.
The next important point to consider is the type of policy that you need. In South Africa, there are various options to choose from, they are Term Life, Whole Life, Universal Life and Cash Value Life Insurances. You should identify which among these will be most beneficial for your family members.
You should know your spending habits and your debts. If you have debts, you should purchase more life insurance so that the liability will be taken care of even after your death. You should calculate how much money would be required for education of your children, your retirement, etc. If you have sufficient savings, you can afford to have lesser term life insurance.
Take at look at your net worth. Higher you net worth, the lower is your life insurance requirement.
The most important aspect of life insurance planning is to review your insurance portfolio periodically, at least on an annual basis. Life and its priorities changes with time. So, your plans should be in line with your priorities in life. The more your family is dependent on you financially, the more is the significance of life insurance. Take one day in a year to do the review of your insurance portfolio. Just find out if you are adequately insured.
Is Life Insurance the same as Funeral Cover?
There is a misconception among many that a Funeral Cover is the same as Life Insurance. And people who have purchased funeral cover, feels that their life is insured. Funeral Cover and Life Insurance aren’t the same. A Funeral Cover just pays an amount to meet your Funeral Expenses. But Life Insurance is much more than that. Life Insurance is meant to protect your dependents from the financial loss they have to face, after you die. A Funeral Cover cannot be an alternative for a Life Insurance policy.
You should do the choice of Life Insurance in South Africa after doing a thorough research. You can compare the various options available in the market, their features and benefits along with their premium costs through our Mister Compare website.