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They say life is uncertain. That's true. At one point, you will hit rock bottom and you need something to help you get back up. This is why there are people who advocate for insurance, including life insurance, because it could give you a push when life hits you hard. 

What exactly is a life insurance? How helpful will this be for you? 

Read on to find out. 

Life Insurance, in a nutshell

This type on insurance pays lumpsum to your surviving family in case of death or after a certain period. 

There are three types of life insurance offered in the market: 

  • Endowment - This type of life insurance grants lumpsum after a specified time or upon death. This means you get to save money for specific purposes like college fund and comes with guaranteed returns upon maturity. Apparently, this could mean higher premiums every month. 
  • Term Life Insurance - This provides death benefit payment after a fixed period, usually between one and 30 years. It is also the simplest and most affordable type of life insurance, which means monthly premium is lower and fits your budget. Here's the catch: in case you didn't die within the agreed term period, you won't get any coverage, which also means all of the premiums paid will be lost.  
  • Whole Life Insurance - This type of life insurance offers either lifelong coverage or up to 100 years old. It comes not only with death benefits but also with an investment component. Since there is an investment involved, you get to earn dividends, which you can withdraw or encash for whatever purpose. 
  • Variable Universal Life (VUL) Insurance - This type of insurance covers disability, death, and living benefits plus an investment component. The difference with VUL from whole life insurance is that the former allows you to choose where to invest your money. 

Benefits of Life Insurance

  • Pays for medical costs, including hospital bills
  • Covers funeral costs
  • Provides financial support since life insurance can be a temporary source of income 
  • Helps you fund your financial or business goals
  • Serves as your retirement fund
  • Premiums can be used to pay for costs incurred from debt and taxes

Things to Remember Before You Get a Life Insurance:

1) Ensure continuity of cash flow. 

Life insurance will get your family covered in case something happens to you. Before they could enjoy that coverage, you need to make sure that your premiums are paid every month. 

Before you get a life insurance, check if your monthly budget could accommodate the payments. One missed payment could compromise your coverage, so it is best to ensure that you have sufficient cash to pay for this. 

2) Consider adding medical coverage. 

There is a separate medical or health insurance that will keep you covered in case of illness. Instead of getting a separate medical insurance, consider adding medical illness in your life insurance coverage. This will mean higher premium, but at least it will offer you protection and peace of mind, especially if major disease runs in the family. 

3) Change unhealthy habits. 

Did you know that being a smoker could affect the amount of premium you will pay every month? This is because smoking has detrimental effects on your health, thereby putting you at a higher risk. 

If you want lower premiums, then quit unhealthy habits and start including the good ones in your routine. Embrace the active, healthy lifestyle, and your body will thank you eventually. 

If you are ready to get a life insurance, these insurance companies could help:

  • Sun Life of Canada (Philippines)
  • Philippine AXA Life Insurance Corp. 
  • BPI-Philam Life Assurance Corp. 
  • Pru Life Insurance
  • Manulife 

Should you get a life insurance? The answer is yes, but. 

It's about your priorities and whether or not your budget can accommodate additional costs. Life insurance has perks and could be helpful in cases of emergency, but make sure you pay on time to avoid compromising your entire coverage. 

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