27th Aug 2014
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Quick guide to life insurance
Author: YourLifeChoices
life insurance, advice, finance

While life insurance may be taken out by anyone, the younger you are, the less thought it’s given. However, as you grow older, your thoughts turn to securing your financial future.


What type of life insurance?

One of the first considerations is the type of life insurance which you require and be the most suitable for your needs. There are typically two types of life insurance which seniors often consider. These are:

• funeral insurance and
• term life insurance

Funeral life insurance

While no one likes to consider dying, it is a fact of life. So, it is something that it pays to think about. Funerals are inevitable and their cost may turn out to be a financial shock. If funeral insurance is in place, it’s one less thing causing stress. With this type of insurance you do not have to worry about loved ones having to fund the cost of your funeral. Funeral insurance, as the name implies, typically pays out upon the policyholder's death.

This type of insurance may suit seniors who have health issues, as typically no medical questions are asked when applying for this type of life cover. In the event of your death, funeral life insurance pays out the amount insured in a lump sum to your loved ones.

Term life insurance

Term life insurance is usually cheaper in regards to premiums than funeral life insurance. This is due to the fact that your medical condition is taken into account. Therefore, several factors may determine the cost of this type of life insurance. These typically include:

  • age – typically, the older you are when applying for term life insurance, the higher you can expect the premiums to be
  • gender – men generally pay more for life insurance due to the fact that their life expectancy is shorter than that of women
  • your health – when applying for cover your current state of health may affect your premium. Relatively healthy seniors or those with only minor issues may be accepted more readily than someone suffering from a major illness
  • smoking – if you are a smoker your insurance premiums may be two or even three times higher than someone who doesn't smoke. If you smoke and quit, you usually have to have been a non-smoker for 12 months in order for the insurance premiums to be lowered.


Term life insurance is typically taken out over a certain term (amount of years) and for a certain amount. If you pass away during the term of the policy, your loved ones will receive a lump sum payment. When considering the amount of life insurance to take out, you may wish to think about such things as any outstanding debt you have, including any mortgage repayments, as well as the needs of those who you leave behind.

Disclaimer: Information included in this article is of a general nature and your individual circumstances should be considered before purchasing life insurance.





    COMMENTS

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    Hasbeen
    1st Sep 2014
    1:58pm
    If those left behind when I go can't get by on the value of the real estate, cars & other stuff I leave, they can go jump in the lake
    CindyLou
    1st Sep 2014
    8:22pm
    I think funeral insurance is a rip off, people should do the sums.
    Also agree with Hasbeen's comments.
    Mez
    2nd Sep 2014
    11:35am
    I am more interested in income protection insurance which is unavailable for over 60's and the premiums increasingly expensive from 50! As a person of 64 who is working and just as healthy as when I was in my 30's, and not on any medications, IT IS DOWNRIGHT DISCRIMINATION!


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