What's the point of life insurance for young adults?

What's the point of life insurance for young adults?

So, life has got serious and you’ve started to think about whether you need life insurance. What even is life insurance? It may be something that your parents or family had when you were growing up, that you (quite rightly) paid zero attention to. But now that you’re ‘adulting’, life and its responsibilities have stepped up and you find yourself thinking about stuff that your parents used to worry about. How has life got to this? 

Whatever the answer is, let us help by giving you an overview of what life insurance is, why life insurance for young people is worth considering and what it can do for you.  

Start here: What is life insurance?

Simply put, it’s a financial backup plan that can support you when times get tough due to sickness or injury, or support the loved ones you leave behind when you die. Once a claim is approved (and depending on the type of life insurance you have), it pays money either as a lump sum or a monthly payment.  

Think of it as a gift your future self will thank you for. Life might be ticking along well, then suddenly you’re struck with a medical condition out of the blue that leaves you unable to work for a while, say 3-6 months. This is where a life insurance payment can help, lightening the financial pressure and providing some funds to support you.  


Types of life insurance for young people.

Now you’ve got a handle on the concept of life insurance, the next thing to know is that there are different types of life insurance that do different things. Have you been looking for the best type of life insurance for young adults? If so, here are some of the common types of life insurance for young adults 

  1. Life cover – this is the one you’ve probably heard of. It pays a lump sum to people of your choosing if you die or are diagnosed as terminally ill.  This money can go towards paying off larger debts like a car or house.   
  2. Income protection cover – this is the one that can step in to provide a monthly income if you can’t work for a while due to sickness or injury. It can be useful to have income continuing to come in while you’re not earning.  
  3. Trauma cover – this one is designed to pay a lump sum if you’re diagnosed with a serious medical condition that’s listed in the policy. It can pay out if something happens to you, like cancer, a heart attack or a stroke.  Payment from a claim can go towards medical bills, ongoing treatment costs and generally lighten the day-to-day financial load, so you can focus on getting better. 

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What’s the point of life insurance for young adults? 

Fundamentally, this is what you need to decide. There are people like financial advisers who can help you work out what’s right for you, but ultimately it comes down to your appetite for risk. Admittedly, that’s a bit of a mouthful, but it’s essentially a matter of asking yourself: do you want to just roll the dice and see what happens? 

Think about it. How would your future go if you didn’t have an income coming in, due to ongoing sickness or injury? What could the knock-on effect be? Could you still pay your share of the rent or mortgage, or have enough to get by day-to-day?  

Of course, you could leave it to chance and be dealt a good hand, but you’ve been around long enough to know that doesn’t always happen to everyone.  

So, the point of life insurance for young adults is to protect your future self from things that might come along one day and interrupt your ability to earn an income. You can either plan for it and have a financial backup plan in place (which is where life insurance comes in), or leave it to chance. It’s a bit like the board game, ‘The Game of Life’.  


How to get started.

If you want to know the best type of life insurance for young adults, speak to a financial adviser. They’ll work with you, helping you decide what you want to be covered for and how much cover is right for you. It usually doesn’t cost anything to get a quote and you’ll find out some valuable stuff like how life insurance can be cheaper when you’re younger, and the benefit of getting cover when you’re generally healthy. If you’d like to have a conversation about life insurance with someone who knows it from every angle, find a financial adviser. 


DISCLAIMER: The information contained in this article is a summary of the key points of the insurance cover(s) mentioned and is general in nature. This article does not constitute a financial advice service. All covers are subject to the definitions, standard exclusions/limitations, terms and conditions contained in the full policy documentation which is available from Fidelity Life or your financial adviser who holds a Distribution Agreement with Fidelity Life. All applications for cover are subject to underwriting criteria.

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