Life insurance is one of the most important investments you will ever make. Whether you are a student or a breadwinner, your life insurance pay-out is the financial lifeline your family will need in the event of your death. As a first time buyer of life insurance you will no doubt be overwhelmed by the number of insurance companies selling life insurance.
How do you, the consumer, know how to compare policies and benefits? How can you make sure that you are buying a policy that will live up to its promises? Read on for our guide to buying life insurance. The first rule of buying life insurance is to remember that cheaper is not always better. While your monthly premiums are an important consideration you also need to consider the following:
- Exclusions: has the life insurance company stipulated that they will not pay out under certain circumstances, for example if you die in a car accident while driving a vehicle that is not roadworthy. Ensure that all exclusion clauses are clearly worded and you understand exactly what would constitute an exclusion.
- Premium increases: how often will your premiums increase and by how much?
- Benefit amount: what is your benefit, or in other words the amount the company will pay out in the event of your death?
- Waiting periods: has the company imposed any waiting periods? For example, some companies impose a waiting period for natural death. This means that they will not pay out a claim if you die of natural causes within the stipulated time period.
It is also important to ensure that you buy your life insurance policy from a reputable insurance company. Check that they are registered with the Financial Services Board by visiting www.fsb.co.za.
Take the time that you need to read any quotes or policy documents carefully and ensure that you understand all the benefits, terms and conditions. Your broker or insurance company should be able to answer any questions you have.
Get a Pure Life Cover quote from 1Life today. It is simple and convenient.