Now, I don’t know what brings you here, but I can guess it’s one of two things.
1. You are curious about life insurance and think you need it.
2. You already have a rough idea of the cost but want another look before you leap.
Am I close?
Ah, sure, what does it matter?
There are no prizes for mind-reading.
You’re here to figure out if life insurance is what you need, and I’m here to help by explaining how it works without making your head fall off.
So, first up…
How Does Life Insurance Work (in plain English)
You pay a premium (money) every month to the insurer, so when you die, your provider/insurance company pays out a tax-free lump sum of cash to your family to replace your income.
But I’ve heard the word life assurance used, is that the same thing?
Well, yes and no.
Both life insurance and assurance pay out a tax-free lump sum if you die.
Term life insurance covers you for a certain term, e.g. 20 or 25 years, whereas whole of life assurance covers you until you exit stage left.
You might be thinking,
but Nick, why the hell would anyone go for term life insurance if it doesn’t last your whole life?
I hear ya, but would you be so convinced of the merits of whole-of-life cover if I told you the premiums were 15 times higher than term life?
So, if a policy that covers you for 25 years is €50 per month, the whole of-life equivalent will set you back the guts of €750 smackers per month.
So, Is Life Insurance Expensive?
No, especially if you stick to these rules.
- Buy life insurance when you’re young (you’ll never be younger than today)
- Don’t smoke
- Keep your weight in check (under a BMI of 33)
Why Do I Even Need Life Insurance?
Look, no one ‘needs’ life insurance, and I’m not going to try and convince, persuade or finagle you into buying something you don’t need.
My job is to give you the facts and let you decide.
You’re a big boy/girl.
Life insurance becomes more expensive as you age, but once you lock in a premium, it’s fixed for the rest of your life.
I’m about to pull numbers out of the sky, so please don’t use them as quotes but as examples.
If you’re thirty and lock in a rather nifty price of €20 per month, you will pay €20 per month forever, even if you’re 70 and still rockin your socks.
But imagine you wait a few years until the fear of your own demise becomes a little too real – we’ll go with the age of 60
At 60, assuming you’re fit as a fiddle, your premium will be €150 per month for the same cover.
Unfortunately, not many of us are fiddle fit at 60, so your premium may be a multiple of €150.
You grudgingly pay that premium knowing full well that if you’d gotten on the ball earlier, you would have saved a fortune (and avoided medical reports, exams etc)
How Much Money Does My Family Get When I Die?
How much do you want them to get?
The size of your cash payout is entirely up to you.
You want a million to pay out; you buy a life insurance policy for a million.
If you think €250k is enough to keep your family financially stable, go and buy a policy for 250k.
You do you, boo.
Don’t worry; you don’t have to pull a random number from the sky and hope for the best.
My job is to guide you through what you need.
We’ll have some really good chats about dying and getting sick; sure, it’ll be great craic altogether.
I’ll get to know your circumstances better, and then I can suggest a few numbers that suit your needs.
Well, Can I Get A Joint Policy With My Partner?
100% yes, you can do this, but it might not be your best option.
If you’re not married, it could leave your partner with a giant inheritance tax bill (in this case buy two single life policies)
A dual life insurance policy is a better option if you are married.
Over To You….
It can feel overwhelming if you are new to the life insurance game.
Et c’est impossible to squeeze all the stuff you might need to know into one single Beginner’s Guide to Life Insurance blog post, although I did give it a try in this Life Insurance Blog
Blogs can only do so much.
Sometimes, you need to talk to an actual real-life expert – we have a few here at lion.ie who would love to help.
We’re so good that we’ll have you swinging around lampposts in the pouring rain like our good friend Gene Kelly.
So, what are you waiting for?
Complete this questionnaire, and we can get cracking
Thanks for reading
Nick
