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No one likes to think about insuring their own life. Itís morbid just at a time when you are looking forward to a long and healthy number of years. Optimism usually prevails and you put it off. Or, rather than think about it too carefully, you buy something basic. Something is better than nothing and, so long as it does not cost too much, you consider it adequate. This is a major change of attitude. For the first seventy years of the last century, the majority of people routinely sat down with an insurance agent to discuss the future and bought not just one, but several policies over the years. This was a reaction to the relatively short life expectancy. Accident and disease killed many younger people. Poor food and inadequate health care meant few people survived into their 70s. Today, thereís been a medical revolution. With improved food and better care, life expectancy has been rising quickly. This relieves the pressure on the life cover decision. One hundred years ago, a pessimistic twenty-something might only expect another thirty years. Todayís twenty-somethings are optimistically expecting another fifty years.

Yet this increased life expectancy represents a different kind of danger. Letís take an increasingly common scenario. A couple get together and plan a family. They buy insurance. Children come, grow up, leave home, and get good jobs. So all that cover you both bought just in case you were not around for paying the college fees is just sitting there. Or suppose the relationship was not a success and you separate. You have not seen your partner for years. Thereís no one depending on you when you pass on.

So what happens if you fall ill and/or need long-term care? The basic life policy only pays out when you pass on. Unless you had the foresight to add a rider to provide more comprehensive protection, your options are limited to using the policy as collateral for a loan, or borrowing the cash value, or surrendering the policy, or selling it on the life settlement market. By paying a slightly higher premium rate, you can buy cover that will pay out should you have an accident or fall ill, and lose your pay while recovering. Similarly, you can add a rider that will cover the cost of treatment if you are unlucky enough to fall prey to one of the more serious diseases like cancer. Finally, as a retiree, the cost of long-term nursing should your health fails can wipe out all your savings. But the right rider can pay these costs.

Deciding what life insurance cover to buy is always something of a guessing game. Itís balancing what you can afford against what you think is likely to happen. With increased life expectancy, long-term care is increasingly necessary. It costs you nothing to ask for additional life insurance quotes to cover personal accident and temporary disability cover. If your family has a history of hanging on at the end, you may feel long-term care is a good investment to protect your family for the additional costs. As is always the case, talking to someone with relevant expertise may help you make the best decision.


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