WHAT IS LIFE INSURANCE?

• You need life insurance to provide your loved ones with financial security if the unthinkable happens. Life insurance is especially important if you have a family, or you have debt or co-signed debt.
  
  
• The amount of the life insurance benefit is based on needs, in accordance with your life situation. A rule of thumb is that the insured sum should cover the amount of your loans, two years’ worth of lost earnings and EUR 20,000 for each child living in the household.
  
  
• The agreed life insurance benefit is paid as a lump sum to the next of kin or to other designated beneficiaries. The benefit payable upon death does not reduce any statutory compensation that may be paid to your family. Read more about claiming life insurance compensation here.
  
  
• Joint cover is shared life insurance between you and your life partner if one of you were to die. Joint cover is a more economical option than separate life insurance policies.
  
  
• You can take out life insurance as either level term or decreasing term cover. With the more commonly used level term life insurance, the benefit payable upon death remains the same throughout the validity of the insurance policy, except for index adjustments; thus, the insurance premiums increase with age. With decreasing-term life insurance, the death benefit decreases annually such that the insurance premium remains the same except for any index adjustments.
  
  
• When applying for life insurance, you must provide an account of your state of health. You will be asked to complete a health declaration form in connection with purchasing the insurance. Based on the information concerning your health, the insurance company will decide whether to grant you life insurance.