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4 Reasons to Get Life Cover in Your 20s

Petrie Marx, 8 August 2018

If you’re twenty-something, buying life cover may not be high up on your to-do list.

But truth be told: Taking out life cover while you’re still young may just turn out to be one of the wisest moves you’ll ever make.

As you pay off a student loan, buy a car and move into your own apartment, you may well feel too financially squeezed to accommodate life insurance in your budget. But you can count on the fact that your older self will thank you decades from now….

Most people acknowledge that millennials are the ‘later’ generation. They’re buying homes ‘later’, having children ‘later’ and getting married much ‘later’ in their lives (compared to other generations). They generally also postpone buying insurance.

One of the common misconception amongst millennials and others is that life cover is pricey – and this may well play a role in decisions to postpone taking out cover. In reality, the cover you need is likely to cost less than you think.

Apart from the fact that life cover will be much more expensive when you try to purchase it later in your life when you are a greater health risk to insurers, you should also consider the fact that you may well benefit from life cover while you’re young – because youth offers no guarantee against severe illnesses.

Consider this: In 2017, 6% of severe illness claims received by Sanlam came from people under the age of 35. While your medical aid may pay for the costs of medical treatment and hospitalisation, there are often shortfalls and hidden costs that can be financially crippling. Imagine having to contribute significant amounts to medical treatment and hospitalisation just when you’re finding your feet in the professional world.

Some of the key benefits of getting life cover when you’re young, are:

  • It will probably cost you less: The younger and healthier you are, the less you’ll pay in monthly premiums, plus you’re less likely to have waiting periods and exclusions on your cover. A healthy, non-smoking female could expect to pay around R190 in monthly premiums for R1 million of life cover at 25. If the same person takes out the same level of cover at 45, she could possibly pay around R460, if she maintained a healthy risk profile.
  • Young people need life cover too: When you start a career, your biggest asset is your long-term income earning potential, given that you are less likely to have accumulated material assets. You need to protect your income earning potential with sufficient income protection and life cover.
  • Don’t burden your loved ones with your debt: Life cover can protect your family from being liable to pay off your debt in the event of your death. Imagine the burden to your loved ones, should you die with significant debt to your name and with no life cover to help pay for it.
  • Accidents happen to people of all ages: According to Stats SA, road users are most at risk in their 20s – in fact, 28.5% of all passenger deaths happen in this age bracket. Should you have the misfortune of being in a tragic accident, it can compromise your ability to receive an income. This can have potentially detrimental consequences for a young person who still has 40 + years of earning potential ahead.

The bottom line is this: You’re never too young to take out life cover. In fact, it can be a saving grace.


Sanlam Life Insurance is a licensed financial service provider.
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