You’ll probably pay a lower premium
Age really is on your side in your 20s. In general, young adults enjoy better health, which can mean lower monthly premiums with no exclusions. Multiple factors impact premiums, but young people are considered less likely to claim, which makes them a lower risk to insure. By purchasing insurance at an early stage in life, your insurance will stay intact as per your policy wording even when your health changes as you get older. If you wait, you’re likely to face higher premiums, or have exclusions.
Young people need life cover too
When you start a career, you tend to think of physical assets first – buying a car or investing in property. But did you know that as a young person your long-term income-earning potential is really your biggest asset? And so, it should be protected with sufficient life cover.
Your loved ones will not be liable for your debt
Apart from student loans, many young people have some form of debt. In order to protect your family from being liable to pay off your debt if you die, it’s key to consider life cover.
Things can go wrong for young people too
According to Statistics South Africa, road users are at highest risk in their 20s – in fact, 28.5% of all passenger deaths happen in this age bracket. A bad accident can compromise your ability to earn an income, which has potentially detrimental consequences for a young person with some 40 years of earning potential ahead. Also, young adults are not exempt from severe illnesses. In 2017, 6% of severe illness claims received by Sanlam came from people under the age of 35.
To find out what type of insurance works best for you, your life stage and financial circumstances, it’s advisable to speak to a financial planner.
Source: https://www.sanlamreality.co.za/wealth-sense/why-20-somethings-should-co...