When we first sat down, I also told him of my past as a financial adviser so he be aware that I may be a knowledgeable client  – to not say difficult, as most knowledgeable clients are…

After fifteen minutes of small talk, we started discussing the details of our cover. It did not take long for the adviser to start pushing the dreaded Investment Linked Program to us. I clearly said that we were not interested in ILPs, but despite my clear requests, he kept pushing ILPs back on the table. I understand that he makes more money from such programs, but if I tell someone we are not interested, he should listen and move on. Otherwise, he may lose us as clients altogether. Which he most certainly did.

So why do advisers not listen to their clients ?

• Most of them lack selling skills and simply learn a script, which makes it difficult to really listen and adapt when needed.
• Their incentives are skewed towards ILPs – commissions for ILPs are very generous.
• They simply don’t care about their clients.

Don’t get me wrong, some agents do behave ethically and will recommend honest products that answer their clients needs and requests. The difficulty is to find them.

Here are a few pointers to help you differentiate between the good apples from the bad.

1. Learn more about personal finance. The more you know, the better you’ll be able to defend your interests.
2. Find an adviser who listens to you. If the one you are sitting down with does not, or handle your objections deftly before coming back to offering you the same type of solution he first approached you with, please, quickly say your thanks and look for a decent adviser. You’ll save yourself a lot of trouble and money.

Good luck !

* TPD and CI are acronyms which respectively mean Term Permanent Disability and Critical Illness

Stripped down to its core, a life insurance provides your loved ones with cash after your death. This money can help your loved ones meet many important financial needs like your funeral costs, your children’s education, your spouse’s daily expenses and retirement plans, and much more. It gives ensures the people you care about the most will be provided for, even if you’re not there to care for them yourself.

The first question you need to ask yourself is whether you need a life insurance or not. To figure this out, you need to imagine the worst case scenario. What would happen to your loved one financially, were you to die tomorrow?

To help you answer this question, you will find here under a few common scenarios I come across regularly. So whether you’re in your 20s, a bit older, a bachelor, married , have children, or not, you will be able to make up your mind whether you need a life cover or not.

You’re Single
If you are single, you don’t really need a life insurance as no one depends on you financially. I only see three reasons for a single person to get a life insurance: (1) when you support your parents or siblings; (2) when you carry significant debt that you wouldn’t want to pass on to your family; (3) As you can guess, the best time to get insurance is when you don’t need it. And you need it least when you’re young, healthy and have a good family health history. So it can make sense to lock in coverage while you’re young and single, eliminating the risk of your not qualifying later in life because you’re older and not as healthy as you once were.

You’re a Couple
Many start thinking about getting a life cover when they get married. After all, once married you share everything with your spouse, including your finances. Therefore, it makes sense to protect your loved one should something happen to you, whether it is to make sure they can maintain their standard of life, or simply cover your debts (credit card, car loan, or mortgage). It also is a good idea to get a cover for the mother-to-be before she is pregnant as some companies don’t issue a policy to a woman during her pregnancy because of the potential health complications.

You’re a Family (Parents + Kids)
This is a no-brainer. Unless you are very wealthy, or your spouse family is, the only way to ensure your families well being is to get a life cover. And do not under-estimate the importance of getting a cover for your stay-at-home spouse. The replacement value of contributions such as child care, cooking, cleaning and other household activities are often underestimated. Think about your quality of life, or your partner’s, and get a cover for both of you.

You’re a Single Parent
If you don’t have a life cover as a single parents, go get one NOW! Your children’s financial future rest on your shoulder. What does happen if you’re not there anymore?

You’re Retired
Once retired, you don’t really need  a basic life cover *. Nevertheless, a life cover can still help your family as its proceeds are payable immediately, ensuring your beneficiaries can take care of funeral costs, and other debts without having to hastily liquidate your assets.

You’re a Small Business Owner
As a small business owner, you have one more reason to get a life cover. What would happen to your business if something happened to you tomorrow? Or maybe to your partner? Or a key employee? You got life cover options like a buy-sell agreement or a keyman insurance which can provide you with enough security and flexibility to help you get through these tough times.

At the end of the day, Life Insurance is the best way to ensure your loved ones well-being. Knowing when to get one, and why you get it, will help you define and optimize your estate planning. Now, did this post make you think about your current life cover? Do you plan to review it any time soon? If so, do you think I missed something here? Please feel free to react in the comment section here under.

* I am not discussing ILP cover and other schemes shielding your assets from the tax-man. I am focusing on simple, stripped down, life cover.