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Many people brush off the possibility of taking out life insurance until it is too late, and they often end up paying unnecessarily high premiums for lump sum benefits that are not always adequate to cover our financial needs when we pass away. Most single individuals with no family ties and very few responsibilities are usually the ones to brush it off, purely because they feel there is no need, but what they need to realise is that, that is the perfect time to take the policies out. The whole reason for that is because you are young and healthy and you actually pose a lower risk to the insurance company because you are technically further away from dying and thus able to contribute more money towards your policy. Unfortunately, it doesn’t always happen that way and people often end up leaving it until they find out that they have some kind of disease or ailment that could be life threatening. They usually get a scare of some kind and they suddenly jump to action by getting quotes from all over the place. What happens then is they end up having to pay almost double the premium they would have paid in the first place. You might argue that younger people are not necessarily at a lower risk, because youngsters often take more risk by doing silly things that put their lives at risk, whereas an older person would have the responsibility and maturity to keep that kind of behaviour to a minimum. In all fairness though, the risk is exactly the same in those instances and it once again comes down to age and how much time you have to make contributions towards your final lump sum payout. When you are younger, your affordability range is usually a lot lower as well so taking out the policy when you are younger means that you will still be able to afford the cover, even though the amount is lower. When you have fewer responsibilities, you can also afford to take a lower lump sum benefit because there is less for you to cover. As you get older, your responsibilities increase and so do your commitments. That is why you have to choose higher amounts for the cover, and you also have to pay more each month. That is why you need to make sure you can afford the premium when you are slightly older, and getting several quotes and doing proper calculations about life insurance Australia to find out exactly how much you need is very important.
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