Life Insurance, which according to most Nigerians is synonymous with death, is not the most pleasant topic to discuss; especially not when everyone is too busy thinking about how to “chop life”, so much so that the need to plan for what comes after pales in comparison. However, this investment opportunity that most Nigerians often neglect, ought to be an important aspect of every adult’s financial plan. Life insurance is a type of insurance that ensures that loved ones are not financially handicapped in the event of the insured’s death. It is important to note that most people believe that they do not need life insurance or it probably isn’t the right time to get one; so here are some tips to help you know better:
1. Who needs Life Insurance?
Generally, if you have at least one person who relies on your income to live, then you are top of the list. You do not have to be the head of a family to deem yourself worthy of life insurance. Recently Millenials and young adults have come to terms with pulling their weight regarding responsibilities; paying off sibling’s fees or having parents in the village who are looking up to them to survive. Life Insurance is the best way to prevent a “Things Fall Apart” episode for your loved ones. If you are into superstitions, the Term Life Insurance plan is probably not the best option for you. However, you can forget the doom and gloom of early death, with a Whole Life Plan and live a long fruitful life with the insurance paid to your loved ones at the end of it all.
2. When to Get Life Insurance
That should be probably right now. It is best to get Life Insurance when you think you do not need it as it does not have to come with the grey hair. The truth is that Life Insurance covers are cheaper when you are young and healthy; the longer you wait, the more you have to pay. Life Insurance companies in Nigeria usually have a minimum entry age of 18 years and a maximum age from 54 – 70.
3. It is the best thing for your business
A business is supposed to be a going-concern entity i.e it is supposed to live forever, irrespective of what happens to the owner. A life insurance plan can make sure that your business is still up and running at the end. It can also be used as collateral for your business loan. Financial Institutions are more likely to give out loans to business owners when they are assured that in the event of a tragedy, their interests are still protected.
4. Getting a plan does not depend on your employment status
Housewives or stay at home parents are usually of the opinion that Life Insurance plans are not for them. However, the loss of a full-time parent usually creates a vacuum that is expensive to fill. Proceeds from insurance plans can be used to hire house helps, cooks and other domestic staff while the family tries to regain their balance.
5. Monetary Implications of a Life Insurance Plan
For those that would rather save or invest in the market than buy a life insurance plan, here’s a shocker: life insurance is not as expensive as you think. For example, If you would like your family to receive N1 million at your demise, all you need is a plan that costs as low as N 130, 000 for a one-time payment; or about N 980 if you choose to pay monthly. This means that you can own a whole life insurance plan with little or no adverse effects on other monetary commitments in your life. It also has living benefits where about 70% of your premium amount will be remitted toward health bills in the event of a critical illness. It can also be used to cover funeral expenses, which comes in handy for us Africans who can go all out for burial ceremonies. Who says you can only get for yourself? You can insure your parent, grandparent or any of your loved ones as well.
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