The life insurance market has existed in the USA since the empire, but there are still many doubts about its importance and the benefits it contemplates. The most common of these is to believe that life insurance only serves to financially protect the family in the event of the death of the insured. Do you know what the others are?
See below for 5 useful information about these products that still confuse the population.
1. Product is not used only in case of death
When it comes to life insurance, we automatically think of the cases in which the insured person dies. However, there are other options for broader protections against countless life hazards.
Imagine, for example, that a patient has been diagnosed with cancer. In addition to the health risk, the disease can compromise the insured’s and his family’s income. Therefore, there are several products available on the market that include protection in case of serious illnesses.
There are other coverages, such as in the case of medical procedures, hospitalization, accidental disability, and anticipation of receipts in case of terminal illnesses. Some products are characterized by the constitution of a redemption value after a certain period of effectiveness of the policy. For these types of products, it is worth noting that the formation of redemption value is not to be confused with a private pension.
Life insurance can still be customized for different health profiles and lifestyles, such as different risk analysis for people in risk professions or hobbies. Therefore, it is important to know all the options and be sure about the ones that best suit your profile before signing the contract.
2. Life insurance does not equate to private pension or retirement
In the last few years, the life insurance category has become popular in which the insured can, at the end of the agreed period, redeem part of the amount constituted over the years even if the claim does not occur.
Contrary to what many people imagine, this redeemable life insurance should not be confused with a private pension, retirement, or any other type of investment. This is because the main objective of life insurance is the financial protection of the insured and the family in the event of a risk provided for in the insurance contract, different from the private pension plan, for example, in which the purpose is to build the necessary financial reserve to guarantee the quality of life during the retirement years.
3. Importance for young people and singles
It is common to think that life insurance is only useful for older people. But the reality is not so, since young people and singles can use life insurance in their own financial planning and that of their family. The numbers confirm that this segment is, in fact, growing.
Unforeseen events can occur at any time in our lives. Although less likely to develop serious illnesses or trigger a claim, it is important that people in this age group are also protected. Young people normally fall into a lower risk category, which reduces the premiums paid. But the more that decision is postponed, the greater the chance of any situation occurring that places the insured potential in a higher risk profile.
Likewise, singles and no dependents who plan to start a family in the future should also think about it and, if applicable, hire the product while prices are more attractive.
4. Affordable costs for different customer profiles
Asked why they did not take out life insurance, many would say it is because there are not enough financial resources to do so. What some people don’t know is that there are customized insurance options for each customer profile.
As with car insurance, a prior risk analysis is carried out, and the price can fluctuate according to numerous variables, such as age, compensation amount, healthy habits, family medical history, among others.
5. Business plan may not be enough
Many companies offer a corporate life insurance plan, but these products do not always fully meet customers’ needs. It is important to calculate whether, in the event of an event, the contracted plan will in fact offer the desired coverage. It is also relevant to read the terms of the contract carefully to see if, in the event of dismissal or job change, there will still be insurance coverage.
Since these products involve many features, including a number of optional benefits, it can be difficult to fit your needs into a particular group. To better meet the demands, it is possible that personalized life insurance is the most appropriate option.