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5 Things You Should Know About Your Life Insurance Policy



Things You Should Know About Your Life Insurance Policy

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When buying life insurance in Australia, we can often overlook the finer details. It is true that there is a lot to read when it comes to any sort of insurance policy, but how do we know what parts are the most important? That’s why we want to give you a brief rundown on what you should definitely check is included in yours. The last thing you want is to pay into a policy that isn’t worth it, so it might be worth paying attention to what we have to say.

1. Is it already included with superannuation?

Indeed, many Australians will already have some level of life insurance included in their Super. However, the level of insurance will be extremely basic. There are two things that you should consider. Firstly, it is undoubtedly worth purchasing additional life insurance that will cover you for any eventuality, and secondly, if you are considering purchasing life insurance, make sure the package includes more than your Super would. There isn’t much point in repurchasing the same insurance, but it is highly recommended to upgrade.

2. Am I overinsured?

There are insurance policies out there that will cost an arm and a leg, but it doesn’t need to be that way. Talking to a broker or taking on some additional internet research can bring you up to date on the terminology so you can be sure of what you want. For example, if you don’t have a mortgage, then you don’t need a policy that can help pay it off.

3. What does my policy cover?

There are hundreds of things that your policy can cover, but there are a few that you should double-check are included. It goes without saying that you want your insurance to pay a lump sum to your loved ones in the event of your passing, but more things are worth adding if they aren’t included already. The most important would have to be terminal illness coverage, funeral costs, and indexation.

4. What are my policy exclusions?

Unfortunately, some policies exclude certain eventualities, meaning that you aren’t always covered. This is something to be very careful of. Most reputable companies who provide life insurance in Australia will inform you of any exclusions, but it is always good to ask.

5. Will my policy actually pay out?

Before committing to a policy, make sure that it is guaranteed to pay out. Sometimes, policies can be outlived, have no grace periods with missed payments, or are investment-linked policies. These are all things that could affect their payout.

One more thing

It is hard to stress how important it is to understand your life insurance policy. It may be a daunting thing to look into, but once you know that it is the right one for you, you will never need to think about it again, so it is one hundred per cent worth it.

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