Jakarta, CNBC Indonesia – If during the coverage period, traditional life insurance is classified into two types, the first is those that can cover up to 99 years of age or for life (whole life), and those whose coverage period will end within a certain period of time or term life. Is buying life insurance that provides lifetime protection profitable?
Term life insurance premiums are certainly cheaper than whole life because the coverage period is shorter.
However, both Term life or whole life are for people who have different financial plans.
Here is the full explanation.
Those who are suitable for term life insurance
People who have low incomes and have dependents are advised to buy term life insurance first. This is because with a low premium, the insured can get life insurance with a high sum insured.
Over time, when their income increases, they can upgrade the sum insured or upgrade to a whole life product if necessary.
Apart from those with low incomes, term life insurance is also suitable for those who have long-term debt.
Considering that death is a certain thing and debt can be passed on to heirs, the person concerned can buy term life insurance in accordance with the time period for which the debt is taken.
Those who are advised to take whole life insurance
The premium that must be paid by customers of whole life insurance is clearly more expensive because the insurance has a coverage period until the customer is 99 years old. But the question is, we never know when we die.
The people who are advised to have whole life insurance are those who want to give more inheritance to their loved ones.
Inheritance may be able to meet the needs of heirs in the future, but the inheritance process itself has the potential to cost quite a lot. With life insurance, liquid sum assured can certainly be used to pay for all expenses in the inheritance process, until finally the inheritance received is intact.
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