Term Life insurance pays a benefit if the Insured Person dies or suffers a terminal illness (where the insured is unlikely to survive for 12 months). Term Life insurance can be used to help your family pay outstanding debt and to cover the costs of their future financial needs such as funding your children’s education.
Benefits of having Life Insurance Cover:
Your insurance will provide a lump sum payment that can be used to:
Pay for funeral expenses.
Repay your mortgage and other debts, so that your family doesn’t have to sell your assets to enable them to meet their future living expenses and maintain their lifestyle.
Leave as an investment for your children or grandchildren’s education.
Distribute your wealth evenly to your beneficiaries without having to sell your assets.
Make charitable bequests.
Cover other expenses such as childcare and housekeeping.
Life insurance will help to safeguard your family against financial hardship as well as to help to protect their savings and assets.
Why do I need Life Insurance Cover?
As a parent, child, partner or carer, having an appropriate Life Insurance policy enables you to ensure that your family does not have to suffer financially in the event of you passing unexpectedly. It may not take away the pain of losing a loved one, but it will ease the pain of any financial burden passed onto your family.
How can I pay for my Life Insurance Cover?
Most Australians with a superannuation fund may be able to utilise their superannuation funds to pay for their Life Insurance policy. Otherwise, Life Insurance can be paid out of pocket monthly or annually depending on the preferred payment methods defined by your insurance provider.
Stepped and Level Premiums?
Stepped premiums are initially cheaper, however, will increase each year – normally on your birthday, or on the policy anniversary date. Stepped premiums are beneficial to insurance policies intended to be held short term. The amount the policy initially increases often goes unnoticed by policy holders, however once policy holders reach a certain age, the amount they pay for their insurance can rapidly increase. By the time you notice this drastic increase, it may be too late – leaving you with an insurance policy that is unsustainable and unaffordable – when you need it the most.
Level premiums allow you to lock-in your premium, sometimes right through to retirement age. Level premiums are beneficial for insurance policies intended to be held long-term. This type of premium initially will be more expensive than stepped premium but can often result in greater savings over the long term. Most importantly, level premiums can ensure that your insurance cover remains affordable and sustainable when you need cover the most.
GI Advisers specialise in helping Australians determine an appropriate level of Life Insurance cover for their personal circumstances. The appropriate amount is different for every individual. You can get an approximate idea of the amount of Life Insurance you require by getting a quote or contacting us at our Brisbane head office.