Life insurance is essential for those of us who wish to provide financial protection for our loved ones after we have gone.
Whilst life insurance is relatively affordable when you’re young, under most policies your premiums will increase each year as you become older. This is known as ‘rate for age’ increases, and these annual increases become significantly larger once you reach your fifties and beyond.
Due to unaffordability, many people find themselves unable to maintain their life cover at a time when they need more peace of mind - not less, and are forced to either reduce or cancel their life cover altogether.
However, by using foresight and being aware of future costs, you can opt to level part or all of your existing life insurance so that your premiums do not increase each year.
Although level-premium cover is more expensive initially, over time the savings are huge and furthermore, the earlier you level your premiums the cheaper it is.
Most insurance companies will let you level an existing policy to age 80 but many New Zealanders are now living beyond this (Source: statsnz.govt. nz). On this ‘level to 80 basis’ your premiums would revert back to a ‘rate for age’ costing once this age has been reached.
One company has approached this differently by offering a level-premium life cover policy through to age 100. Furthermore, if you reach your 100th birthday they will reward you by refunding ALL of your insurance premiums.
At Foresight Financial we believe it is all about being able to make informed choices through unbiased advice. We pride ourselves on our personal customer service and honesty. None of us can see into the future which is why you need to use Foresight in your ongoing financial planning.
Please do not hesitate to call either Michael or Amanda Lay to arrange for a free no-obligation review. A disclosure statement is available on request and is free of charge.
Amanda and Michael Lay
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