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A gift for your children and grandchildren that makes good financial sense

It's a fact that life insurance is more affordable when you are younger and healthier. As time goes by and you get older, the risk for the insurance company to insure your life is higher so the premiums you pay increase.

It is also very likely that people will need life insurance at some stage of their life, especially if they will have other people that depend on them. Some of the most common reasons people get life insurance is when they start a family, get a mortgage or own a business.

Have you ever considered buying life insurance for your children or grandchildren and securing the best possible price for something they will need later in life? You might consider what we call a 'level premium' life insurance, a gift that makes good financial sense. Find out more about level premiums here.

By buying life insurance for your children or grandchildren, when they are young you can lock in their premiums at a great price. After all, the younger you are when you take out a life insurance policy, the lower the premium will be for the life of the policy - and the more you'll save. The other benefit of taking out a policy when you are younger is that there should be less exclusions on their policy as they are less likely to have health issues at a younger age. We unfortunately see this happen way to often, clients not taking up insurance at the right time, and then being diagnosed with a serious disease. At that stage it is too late to get insurance.

Even if your children or grandchildren don't see the importance of having life insurance now, by getting a level premium policy for them you are securing big savings for them. You could potentially pay their premiums for them to start with, and they can take on that responsibility later on themselves. They will certainly be grateful when the time comes to start a family or take up a mortgage and the life insurance premium they have to pay is only half of what it could have been thanks to you.

Please note that your children or grandchildren will need to be at least 10 years old to take out an insurance policy on their life, but you will need to be the policy owner.

Does buying financial security for your children or grandchildren sound like a good idea to you? Contact us on advisers@apexgroup.co.nz or 0800 500 510.

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