Fresh graduates are often excited about finding a job since working implies getting a steady income flow which in turn implies being self reliant.
Most fresh graduates who get jobs soon after they are eligible to work; often do not understand the importance of life insurance since they believe that they are young, healthy and do not need life insurance plans.
The following paragraphs will elaborate on why life insurance is a must for people who have just got their first job and how your first job can impact your life insurance policy.
Why Opt for Insurance?
Single adults who have dependants should opt for insurance so that they can meet the needs of their dependants even when they are unemployed or pass away due to natural reasons, an accident or illness.
Single adults who do not have dependants should opt for insurance plans so that they can maintain tier lifestyle even when they are temporarily unemployed due to work reasons. Insurance can also ensure that the policy holder has peace of mind knowing that his finances will not be adversely affected when he is ill or injured.
Types of Life Insurance Plans
- There are at least 4 types of personal insurance plans that fall under the life insurance bracket. These plans include term life insurance, income protection insurance, business expenses insurance and trauma insurance.
- Term life insurance or term death cover pays a lump sum amount to the beneficiaries of the policy holder’s estate if he or she passes away due to insured reasons such as accident or illness. Death by natural causes is also an insured event for term death covers.
- Income insurance plans pay a monthly compensation payout to the policy holder in some scenarios such as illness or injury. Income protection insurance plans pay out the pre-decided amount or a variable amount to eligible policy holders when they are unable to complete one or more tasks at work due to health conditions. These plans have both a mandatory waiting period and a benefit period; however both these terms can be adjusted to suit the policy holder’s requirements.
- Business expenses insurance plans are meant for self employed individuals who want to protect their business by insuring their business for fixed expenses. This type of cover pays monthly compensation payments when the policy holder is unable to work and needs financial aid from the insurer to pay for fixed costs of the business. Rent, wages of certain staff members, electricity and water bill are a few of the fixed expenses that insurers, compensation the policy holder for.
- Trauma insurance plans pay a lump sum payment to the policy holder if he is diagnosed with cancer, heart problems or any other critical illness. These plans also cover conditions such as cancer and loss of limbs. The compensation payment received by the policy holder can be used to pay off existing debts before the illness gets too serious, or can be used to keep the policy holder comfortable until the illness becomes fatal. Cancer survivors can benefit significantly from these plans.