Concerts, weddings, and wild adventures \u2013 your crew is making memories. What about your future? Life insurance may not be on your radar yet but locking it in early could be the smartest financial decision you ever make. <\/p>\n\n\n\n
This month, Discovery Life shares insights on why young professionals should consider the invaluable benefits of life cover.<\/p>\n\n\n\n
Protecting your phone and car against the unpredictable is second nature, but what about protecting your most important asset \u2013 you?<\/p>\n\n\n\n
When you\u2019re in your early 20s to mid-30s, life insurance is probably the last thing on your mind. It\u2019s easy to think, \u201cI\u2019ll deal with that later\u201d; \u201cI already have cover through work\u201d; or \u201cI\u2019m healthy now, so I\u2019ll wait\u201d. <\/p>\n\n\n\n
However, waiting for \u2018later\u2019 could come at a large cost to those with the majority of their future earnings still ahead of them.<\/p>\n\n\n\n
Do you have a plan if you\u2019re no longer able to earn a salary due to a life-changing health diagnosis or a permanent disability? <\/p>\n\n\n\n
How would you pay your rent or bond, for groceries, medical aid, car and family responsibilities?<\/p>\n\n\n\n
\u201cWhat many young people are unaware of is that life insurance offers far more than just cover that pays out when someone passes away.”<\/p>\n\n\n\n
“Life insurance is an incredibly powerful tool and can be a financial safety net if a severe illness or disability stops an individual from being able to earn an income,\u201d says Gareth Friedlander, Discovery Life Deputy CEO.<\/p>\n\n\n\n
A 2022 Association for Savings and Investment South Africa (ASISA) Life and Disability Insurance Gap Study<\/strong><\/a> revealed that the average income earner aged 30 and younger is underinsured. <\/p>\n\n\n\n This means they will be unable to maintain their own, or their dependants\u2019, current lifestyle if they become disabled or pass away. <\/p>\n\n\n\n The average income earner aged 30 and younger earns a little over R10,000 per month, but typically needs more than R2.7 million in disability cover to maintain their standard of living post claim. <\/p>\n\n\n\n On average, they only have disability cover of around R1 million, leaving an insurance gap of R1.7 million.<\/p>\n\n\n\n \u201cThe insurance gap for South Africans under 30 is concerning,\u201d says Friedlander. <\/p>\n\n\n\n \u201cHaving holistic life cover in place that includes income protection, severe illness cover, and disability cover when you’re young is one of the smartest things you can do.\u201d<\/p>\n\n\n\n \u201cAlong with paying out an insured amount to your loved ones if you pass away, life insurance can also protect you against financial risk if something unpredictable happens while you\u2019re alive,\u201d explains Friedlander. <\/p>\n\n\n\n The three main \u2018living benefits\u2019 are income protection, severe illness cover, and disability cover.<\/p>\n\n\n\n This benefit pays you a regular income if you are unable to work due to injury, illness or disability. <\/p>\n\n\n\n Discovery Life\u2019s Income Continuation Benefit automatically provides comprehensive whole-of-life financial protection rather than expiring at retirement age and provides boosted payouts on permanent disability.<\/p>\n\n\n\n Severe illness cover pays out a lump sum based on the severity level of the illness and can be used to cover costs such as treatment costs and lifestyle modifications. <\/p>\n\n\n\n \u201cSome of the key features of our Severe Illness Benefit at Discovery Life are comprehensive multiple claims cover, cover for both early\u2011stage cancers and relapses, additional payouts to access the best treatment globally as well as automatic cover for your children and parents,\u201d adds Friedlander.<\/p>\n\n\n\n Disability cover pays out a lump sum if you become disabled. <\/p>\n\n\n\n It can help cover any associated costs such as buying or maintaining specialised medical equipment, lifestyle modifications or settling debt. Friedlander notes: <\/p>\n\n\n\n \u201cOur LifeTime Capital Disability Benefit provides you with additional payouts upfront and over time to help you access cutting-edge medical technology to help minimise the impact of the disability on your lifestyle.\u201d<\/p>\n\n\n\n Alarmingly, severe illnesses like cancer are increasingly affecting younger people.<\/p>\n\n\n\n Over the past 30 years, cancer rates in the G20 nations (which includes South Africa) have increased faster for 25 to 29-year-olds than any other age group \u2013 by 22% between 1990 and 2019. <\/p>\n\n\n\n Rates for 20 to 34-year-olds in these countries are also now at their highest level in 30 years. <\/p>\n\n\n\nHow living benefits are an insurance lifeline for young people<\/strong><\/strong><\/h2>\n\n\n\n
Income protection<\/strong><\/strong><\/h2>\n\n\n\n
Severe illness cover<\/strong><\/strong><\/h2>\n\n\n\n
Disability cover<\/strong><\/strong><\/h2>\n\n\n\n
What does the data say about young people and life cover claims?<\/strong><\/h2>\n\n\n\n