As you adapt to life back on campus, your priorities are probably to focus on your studies, graduate on time, land your first full-time gig (#payday), and live it up along the way. Being a young varsity student, buying life insurance is probably the last thing on your mind. But it really should be up there along with how you’re going to celebrate Rag Week.
According to Bidvest Life’s 2022 Claims Report, full-time tertiary education students were the second most common occupation to claim on Event Based Cover.1 Read that again: Students were the second most likely group to claim on their income protection policy for injuries and illnesses that affected their ability to pursue their studies, careers, or future to come.
So yes, you’re young, you’re healthy, you’re in the prime of your life. But should you still have life insurance cover in place to protect yourself against the effects of illness or disability? Simply – yes. Jessica Beattie, Acting Chief Marketing Officer at Bidvest Life shares four good reasons why:
There’s a lot more to life insurance than you think: Life insurance is an umbrella term for a portfolio of products that on one hand, protects you against the loss of income due to illness, injury or permanent disability. On the other hand, life cover also pays out to your beneficiaries when you pass away. As a student – or someone starting out in their career – do you need R2 million in life insurance for your beneficiaries right now? Probably not. But you should look closely at your financial responsibilities to ensure that your loved ones are financially protected in the event of your untimely death. For example, a lump sum payout might help your family to pay off your student loans. Similarly, life income cover ensures your family receive a monthly payout that would take care of financial obligations that you were contributing to the household.
Income protection and critical illness cover are, well, critical: Even as a student, you need a safety net in case of an accident or illness that robs you of your potential to live the life you’re planning. That means having income protection (especially if you’re working your way through your studies), as well as cover for critical illness and disability. Adam* was still a student when he lost the use of his arm in an unfortunate hit-and-run accident. For most students, that would have been a major blow to their prospective career and earning potential. Fortunately, Adam had Event Based Cover in place, which means his future earning potential is protected until retirement age.
The younger you opt in; the more you get out: When you buy life insurance as a younger person, you’re typically going to have lower monthly premiums because your risk profile is that much lower. And, if you do not have any pre-existing conditions – like hypertension or high cholesterol, which generally affect older people – you should invest in life insurance now, before health issues arise, and your policy may need to cater for exclusions.
Protect your future earnings… Starting today: Even a temporary injury or illness could result in your studies taking longer to complete and delay your career, derailing your ability to earn income later in life. In the worst-case scenario, a more serious or permanent disability could affect your entire future earning ability, in which case you could remain financially dependent on your parents or siblings for the rest of your life.
Life insurance is a big part of embracing your independence and becoming financially savvy: if you want to go places – earn admiration, pursue success, and command respect – start investing in your future by opting for an income protection policy and locking in your good health while you can. Now is precisely the time.
1Bidvest Life 2022 Claims Report
*Not his real name
