Ep. 12 Are You Too Young for Insurance?
In this first of a three part mini-series, I interview estate planning advisor Greg Jizmejian to discuss the insurance needs of younger individuals and families.
Broadly speaking, those between 25 - 40 years old. We discuss what risks are most prevalent and what types of insurance should be considered.
Unlike other products, insurance is something you buy when you don’t need it. It's like a redundancy plan. It provides you with the comfort of knowing that it will be there as a backstop if your main plan falls apart. For example, although many people believe that the biggest reason for home foreclosure is the loss of a job; it’s actually not, it’s disability. In addition to long term disability insurance, we also look at critical illness insurance options and how they compare.
It's important to understand the distinctions between different types of long term disability because there are so many grey areas. We discuss why and how as an employee, your company’s group benefits plans would differ from the long term disability insurance you get on your own. Of particular interest to professionals is understanding what type is best suited for them.
Greg goes on to compare critical illness insurance to long term disability insurance. What CI pays, when it pays, what you can use it for and also how Covid-19 impacts critical illness.
Doing a proper needs analysis is key to determining the types and amounts of coverage that make sense for each individual. It should be customized. And the good news is, a needs analysis really doesn’t take a lot of time or effort to do.
Contrary to popular belief, Greg discusses why a young person with no debt and no family might need to get life insurance. He uses his own daughter as an example. What some of the benefits are when buying insurance for children. How insurability can be impacted not just by health but also occupation and where you live or work.
For those with mortgages, you’ve likely been introduced to the concept of mortgage insurance. Greg compares taking out insurance at the bank vs on your own. He discusses why he thinks that these types of insurance are not the best in most cases.
