You might think that you need Life Insurance in much the same way that a fish needs a bicycle.
Which, of course, is to say that you don’t need it at all.
But here’s the thing: You need Life Insurance in much the same way that a fish in a fishbowl needs a fish tank.
Meet Jaws, my hypothetical fish.
I feed him. I clean his bowl which I occasionally poke at it and wonder why I got a fish and not a proper pet.
But Jaws would be so much better off in a fish tank.
Think of the pH balance; the extra room to roam; the added security and space of the tank.
Sure, it’ll cost more but Jaws will be so much more comfortable in that fish tank. He’ll sleep a lot better.
And that’s what life insurance brings about: being comfortable, feeling secure.
By the way, if you can think of a better fish/life insurance analogy, let minnow.
So when you think of Life Insurance, you probably think of the big one – DEATH – your family gets a pay-out. They can use it to clear the mortgage, pay off any debts or buy a pyramid-shaped tomb so you can go out in style like an Egyptian king.
Nicolas Cage did that last one. He also apparently owns a dinosaur skull, a pet octopus, and two islands. Some man for one man.
Anyway. My point here is that lump sum would really help your family out after you die. It makes sense to have such a safety net.
But here are some more reasons why you need Life Insurance:
In truth, you and your family are fecked without it.
I mentioned up top about how you might think that Life Insurance / Death Insurance is the big one – or the only one worth considering. It’s not.
In short, here’s a list of the ones we’re going to look at:
So now let’s look at the reasons why you might get each one. And yes, you can get them all – and sure your friendly neighbourhood bank manager would fecking love that (laughing all the way to the vaults as he goes to buy an octopus and two islands, probably) but let’s also be realistic about it.
Budget is important.
You have enough to be paying for without buying all of the insurance as well.
Without it, they would STARVE.
Okay, maybe not starve, but their lifestyle would unrecognisably change if you weren’t around to bring home the bacon. They would have to survive without your income.
“No mon, no fun” as the fella says.
A) How much do you earn?
B) How many years until you quit working?
Multiply A x B. This is the income they will lose.
So let’s say you earn €50k and will retire in 30 years:
€50,000 x 30 = €1,500,000
Your family will lose a cool one and a half million in future income on your death.
Life insurance will leave a lump sum to replace some of that income.
It only costs a few quid yet it’s the best present you could ever buy (well, that and income protection – see below)
And it will give you a warm and fuzzy feeling when you tuck them in at night knowing they’ll be okay should the worst happen. Trust me on this. Before I bought life insurance, there were a lot more “what ifs” going through my head before I fell asleep.
In all seriousness, here’s some gick food for thought for you: funerals are expensive.
Really expensive. And not even the kind involving Egyptian kings.
Even a basic one costs €5,000. You can pretend you’ll live forever or hope that your kids/other half hit the big time, or you can take out some Life Insurance cover.
If you’re self-employed like myself, you’d be even more of an eejit not to get some kind of life cover. Honestly, it’s downright irresponsible not to be covered. No one else is gonna swoop in to save the day. You don’t have the safety net of death in service benefit or life insurance through work.
In short, if you’re a regular hamster on the great hamster wheel of life, you need some cover. If you’re a hamster with baby hamsters, GET LIFE INSURANCE.
Seriously. Be sound. If you are without child, consider Income Protection:
No kids. No need for cover?
Let’s say you get sick – not lie in your bed with a sore head sick, but proper sick. So sick you’re in and out of hospitals, and you’ve no time to think about anything else except your recovery.
It happens all the time.
Sure, you can go on State illness benefits – which is €203 a week. That’s €812 a month.
Not looking so great, is it?
Income Protection could be a lifesaver here. You could also consider Serious Illness Cover, but honestly, I’d nearly always recommend that you go with Income Protection – it’s basically a replacement income for you. Serious Illness Cover, while good, could trip you up in T&Cs, especially if you get ill with an illness that’s not covered in your policy.
So yes. Income Protection. Get it if you are a person with a job who likes having money.
Basically, Income Protection is your guarantee of keeping a roof over your head.
It’s a piece of paper that you can show to your landlord or bank to prove you’ll be able to pay the rent/mortgage soon in a few weeks once you receive your income protection money.
Without it, your bank/landlord may be very sympathetic but it won’t be long before they kick you out.
You can pay off your mortgage or any debts you have with Mortgage Protection
Well, technically not you as you’ll be dead.
But the ‘you’ in the bodily sense, who has kindly left behind a wedge of cheese for the fam.
After you die, any debts you have must be repaid from your estate before your family receives anything. That could include a small loan right up to a stonkin’ big mortgage.
Mortgage Protection comes in realllll handy here.
If you’re getting a mortgage in Ireland, you have to get a Mortgage Protection Insurance policy – because the law likes to protect the banks, even though you could blame them for the last recession.
But sure look it.
Now, if you don’t have a mortgage and you have no plans of getting one (housing crisis, wha?), you could still consider some cover – especially if you’re renting with the other half. If anything happens to them, will you be able to afford the mortgage repayments on one income? If something happens to them, will you be even able to keep working and bring in one income?
At the very least, scroll back up to point number two on this list and think long and hard about the value of Income Protection.
Income protection can be pricey if you have a higher risk job. You see the insurers price income protection based on your occupation. There are four classes:
So if you work in an office, cover is cheap, however if you do manual work, cover can be expensive.
The insurers underwrite income protection strictly so if you have some pre-existing conditions (mental health, muscular/joint pain) you will face exlcusions for those conditions. Multiple exclusions makes serious illness cover more attractive.
Multi Claim Protection Cover is also worth considering if you have a chronic illness like MS or Diabetes.
Look, the main reason Life Insurance is important is peace of mind.
You can sleep easy knowing that whatever life throws at you, you and your loved ones will be okay financially.
In short, you’re paying the insurer for a good night’s kip.
And I promise it’s probably not as expensive as you think it’ll be.
Case in point: Joe, an average 45-year-old, wants 30 years’ cover. He doesn’t smoke and would like cover of €250,000. Joe is smart, so he add the conversion option– which means he can continue his policy after the 30 years without answering any medical questions.
That way he gets guaranteed cover until age 91 even if he suffers health issues before then.
This is how much his Life Insurance would cost per month:
Your internet probably costs you more than that.
Think about it.
If you’ve decided that you do need Life Insurance but haven’t a clue where to start, I’d love to help you.
Tell me a little bit more about yourself and we can get cracking or call me on 057 93 20836.
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