As a young, healthy adult, the possibility of passing away anytime soon may seem so remote that it is not worth planning or preparing for. You may do your best to follow a healthy diet and exercise frequently. You may maintain a healthy weight and have no underlying health conditions. Buying life insurance is something that you may understand is important, but you understandably may not think that it is worth paying for at this point in your life. However, a closer look reveals that buying life insurance for healthy people is a smart move to make.
Why Most People Need to Buy Life Insurance
Death can occur at anytime. Rather than being a possibility, it is a reality that everyone experiences at some point. Some people are fortunate enough to pass away late in life, but many others will pass away unexpectedly. In fact, some pass away as young adults because of an accident, disease or other unforeseen circumstances. People who are the image of health may develop serious medical conditions that ultimately have fatal consequences.
In addition to never knowing when death will come, you also need to think about the impact that your untimely death would have on your loved ones. Just as you may not be expecting to pass away at a young age when you are healthy, they also may not be prepared in any way for this possibility. Regardless of when you pass away, you may leave behind dependents who require financial support. Your loved ones may be burdened by end-of-life and funeral expenses, any debts that you leave behind and more. Life insurance benefits provide your loved ones with a way to manage these expenses and to support dependents. In addition, life insurance benefits may provide your family members with the opportunity to grieve without feeling financial pressure. These are just some of the reasons why buying life insurance for millennials and other young, healthy people is a good idea.
The Benefits of Buying Life Insurance When You Are Young and Healthy
The benefits of buying life insurance at any age are substantial, and the good news is that life insurance premiums may be much more affordable when you purchase coverage at this point in your life. For most policy types, life insurance companies determine premiums based on the statistical likelihood of you passing away. This is determined by looking at health-related factors, including your height and weight, your health history, if you are a drinker, or if you are looking for term life insurance for smokers, and more. You generally will be required to pass a medical exam, which will review your blood pressure, body mass index, bloodwork and urine.
If you rank well in each of these areas, you may qualify for a great premium. Insurance rates typically chronologically based on your age. This means that buying coverage today may be much more affordable than if you wait until you are only a year or two older. In addition, your insurance rate will be locked in for the entire length of the term. Many young and healthy adults may not qualify for a lower rate than what they qualify for now.
Types of Life Insurance for Healthy People
Before you set up a life insurance policy, you should understand what some of the more common coverage options are. These are some policy types that you may consider:
- Term Life Insurance: Term life insurance is appropriately named because it remains in effect for a specified term length. You can choose a desired term length, and the options usually are available up to 30 years. Because rates may be lower at this point in your life, it may make sense to purchase a policy with a longer term than to purchase a shorter-term policy now followed by a subsequent short-term policy later.
- Permanent Life Insurance: Permanent life insurance, which includes whole and universal life policies, generally is more expensive than term life insurance. However, it remains in effect until you pass away or stop paying the premium. It also can accrue cash value in an interest-bearing account, so it is considered a financial asset.
- No Medical Exam Insurance: If the idea of enduring an unnecessary medical exam is not appealing to you, a no exam life insurance policy is an option to consider. There are numerous policies that fall under this umbrella. While rates are typically higher because of the lack of an exam requirement, the cost may still be reasonable when you buy this coverage when you are young and healthy. The coverage limit for this type of plan may also be much lower than for term and permanent life insurance.
What You Should Look for When Buying a New Life Insurance Policy
If you have decided that now is the right time to purchase a new life insurance policy, take time to compare the options carefully. Before doing so, however, assess your needs. Consider who will need access to the benefits and how they may use them. Because your policy may remain in effect for decades, you should think ahead about your loved ones' future needs as well. To be sure you find the best policy that suits your needs and fits your budget, talk to a life insurance agent today.