Life Insurance Myths Busted

Over the years the topic of life insurance has become an area where lots of myths have developed. The fact that life insurance is not an easy and straight forward product means that a lot of people find it hard to get their head around what is the best life insurance cover for them. This is where the myths that are out in the open start to affect your judgement on life insurance. Lifebroker.ie want to dispel some of these myths.

The following are some of the major myths about life insurance and the reality behind them.

Only the Main Earner Needs Life Insurance

If you're the main breadwinner in your household, you'll almost certainly want to consider life assurance. But it's not just the chief wage earner that needs to think about cover.

For example, if you have a partner who is caring for your children and that person died, you could face new costs such as having to pay someone for childcare.

It's tough to assess how a tragedy might change the lives of those you love – but it would be even tougher for them to face financial hardship on top of their loss.

I’m Single with No Next Of Kin, Getting Cover Is a Waste of Time

Despite what you think every person whether single or in a relationship should consider life insurance. Even if you are single with no dependants you still need to assess the financial situation you will be leaving behind if tragedy should strike. Having life insurance could help cover the cost of any personal debts, medical expenses or even funeral costs.

Life Insurance Cover Needs To Be 10 Times My Annual Salary

The days of calculation the amount of cover you needs based solely on your income have long since pasted. Instead you need to ask yourself the question “How much protection would my family need if I were to die?” It's tough to assess how a tragedy might change the lives of those you love – but it would be even tougher for them to face financial hardship on top of their loss.

Look at the size of your mortgage and any outstanding debts, and also consider how much money your family would need to meet costs like school fees, bills and living costs if you were no longer around.

A guide figure is around 10-times your salary, but this will vary depending on your circumstances. If your mortgage is only small, you have significant savings or your partner earns a high salary, you may decide you need less cover. On the other hand, if you have a large mortgage and young children in private education, you may need to consider increasing your cover.

My Work Provides Term Life Insurance Cover, This is Enough

This depends entirely on your own person circumstances. If you are a single person living off modest means, cover provided by your work may be enough. If you have a spouse or children, you need to factor them into the equation. Will the cover your work provides be able to support them and pay off any debts you leave behind in the event of your death? Considering additional cover to allow for this may be something you should look into.

It’s Better to Invest My Money Than Buying Life Insurance

When you invest money, you are taking a risk. You are hoping that your investment will either hold its value or that it will increase in value. This is all well and good but investments are just as likely to decrease in value. For example, if you invest €100,000 in a new holiday home, this investment may increase or decrease in value depending on the stability of the housing market. If, after you die, your dependants need to sell this home, will the value of the home at the time of sale leave enough coverage to cover their financial needs? These are the questions you need to consider when approaching this situation.

At lifebroker.ie we can get you the right cover for your needs and give you peace of mind that you’re covered. Call us today on 01 660 6900 and our life insurance specialists can talk you through your options and have everything ready for you within one quick phone call.