Life insurance: Should I or shouldn’t I?
When it comes to life insurance, the question is usually asked: do I really need one, or can't I just overtake the risk myself? If only it were that simple. Life insurances can namely be a great alternative seeing as they offer a long-term savings protection and, if needed, additional insurance risks, to cover you or your loved ones. Thanks to these components, they provide more confidence in the long-run versus standard saving solutions.
What is a life insurance?
Generally, a there are two types of life insurance: pure risk- and the so-called mixed life insurance. The latter makes up the majority of life insurance policies. For good reason: On the one hand, the mixed life insurance can cover the financial risk of disability due to an accident or illness. On the other hand, it can cover the financial risk of death if necessary and also includes a savings component.
Why should I take out a life insurance?
If you are no longer able to work due to an accident or illness (disability), you and your family are financially protected by a life insurance policy. Furthermore, with a mixed life insurance, your loved ones would receive a lump-sum paid out in the event of death. In many casses, families have to deal with income losses when someone passes away, for which reason this coverage can be vital. Further to the above, with a mixed life insurance, you will receive the invested savings capital upon retirement.
Good to know:
A life insurance can also be used to build up assets in a self-determined manner. In contrast to a pillar 3a account with a standard bank, you tend to benefit from better services in the long term (full cost calculation) and a cost guarantee. Insurances are also suitable for people who prefer a consistent and supported savings process rather than taking action themselves.
A life insurance makes sense if:
- The disability coverage arising from the 1st and 2nd pillars are not enough to maintain your standard of living, which is usually the case in the event of illness.
- In the event of death, your assets and survivor's pension are not sufficient to provide financial security for your family or partner.
- You need a little help to make sure you keep making savings, ensuring you never miss another 3a payment 😊.
Which life insurance policy suits me?
Whether you need life insurance or not is influenced by many factors. Too much technical jargon? No problem: Our pension experts will happily explain everything to you in an easy, and understandable way and work with you to find perfect solution for you. Book your free pension consultation now (VideoCall).
Your Caveo team