Life insurance cover provides you with two main premium options – ‘stepped or ‘level’.
‘Stepped’ premiums increase yearly with age, any inflation adjustments and general changes in premium rates. Premiums are very affordable in the short term, becoming increasingly expensive in later years. Many older clients face the situation where they may want or need to retain the cover but cannot afford to keep it.
‘Level’ or fixed premiums are set for a specified period and do not change with age. Premiums are initially more expensive than stepped cover, but significantly cheaper over a longer period of time. This allows clients to retain cover for longer and manage future premium expenses.
Stepped premiums are generally suited to short to medium term requirements where there is a finite need for cover such as debt repayment or providing for dependants. Premiums are affordable during the period required and cover can be adjusted as needed.
Level premiums are generally suited towards longer term requirements where there will always be a fixed need for cover, regardless of age. Estate planning purposes, funeral expenses and business succession covers are all situations where level premium type cover may be more affordable over an extended period of time.
Whatever your needs, it is important to get some advice on the most suitable option for you. Talk to us today about your premium options to best meet your needs.