27 Jul Do I Need Any Cover? 5 Lies About Life Insurance.
Do I Need Any Cover? 5 Lies About Life Insurance.
You might be thinking, Do I need life insurance?
You may have run into a few misconceptions while doing your research, which could have prevented you from helping protect your family financially.
In this article, we will look at 5 myths about life insurance.
1) Life insurance companies don't pay out.
You may have heard claims that insurance companies refuse to settle claims. This isn’t actually the case. There are a few ways to make sure that your loved ones’ claims pay out.
Here’s how:
1) Firstly, fill out the application for cover completely, honestly, and correctly. When Applying, failing to disclose important information to your insurer could have an impact on a later claim.
2) Secondly, ensure your family is aware of your insurance policy. Including the name of the insurer, the policy number, and the duration of the coverage. If they need to make a claim, this will make it simpler. Also, if your policy is in trust, this can speed up the lengthy probate period and allow your loved ones to receive the funds quicker.
2) I don't need life insurance as my employer provides it for me.
Some employers offer their employees life cover as a part of their benefits package. Known as a death in service. This would cover them for around 4-5 times their salary and the money would go to the chosen beneficiaries if you were to pass.
3) Companies make it difficult to claim.
A lot of people think that making a claim is a difficult and lengthy process. However, that is not always the case. If you’ve taken out a policy, you’ll want to have peace of mind knowing your loved ones have the financial protection they need in place. Also, knowing that when a claim’s made the process is as straightforward as possible.
If your policy is in trust, then it’ll be even easier to claim as the company knows exactly who the money is going to. Also, it ensures that the proceeds of the policy pay out swiftly (without the need for probate).
Hence, why we always recommend our clients put their policy in trust, as losing a loved one can be distressing. This can help make claims as straightforward and stress-free as possible.
4) Cover is too expensive.
Drewberry conducted a survey. They noticed clients overestimating the cost of Life Insurance. When we asked adults to estimate the cost of the cover to provide a 35-year-old non-smoker with £250,000 until 65. The average estimate came to £42.74.
However, the true figure to provide such an individual with this level of cover is just £14.35 — a whopping 197% less than what the general public estimated. (2)
5) I need a medical exam to get life insurance.
Some people don’t take out any cover because they think it’s a long process and they will need a medical. However, it’s not always needed.
The only time you may need a medical is if you are applying for a large amount that passes the threshold or due to your age.
It is important to answer every question truthfully on your application as it could affect your payout in the future if you do make a claim. If the company can’t give you a decision on whether or not they can provide you cover due to past medical issues. They will send the information off to underwriters to look into your case in more detail. With your permission, they would usually ask your GP for a medical report and give you a decision based on what’s on the report.
It is as simple as that, the process does not take long and you most likely won’t have to have a medical when taking out some cover.
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