Table of Contents
Life insurance might not be the first thing you think of when you’re in your 20s or 30s. With so many exciting life events and milestones to focus on—starting your career, travelling, and maybe even buying your first home—we know it’s easy to overlook.
It can be a mistake to assume that only older couples with children and assets need life insurance. Young adults, even those without dependents or significant assets, can greatly benefit from obtaining life insurance early on.
Reasons to Get Life Insurance in Your 20s and 30s
Financial planning is crucial for young adults, and life insurance is an essential part of this planning. Even though it might seem early, purchasing life insurance in your 20s and 30s has a number of important advantages that can bring stability and comfort in the long run.
It’s Cheaper at a Younger Age
Insurance providers determine premiums based on your age and other factors, so getting coverage while you’re young can save you a significant amount of money over time.
For instance, let’s say you are 25 years old and considering getting life insurance, but you keep postponing. The longer you wait, the more expensive your premiums will become. Below is a comparison of premium prices for each age (as of June 2024).
Age
25
45
Smoker status
Non-smoker
Non-smoker
Amount of cover
€300,000.00
€300,000.00
Term length
30 years
30 years
Average cost
€17.66
€59.62
As we can see in the table above, the difference in premiums between someone taking out life insurance in their 40s and their 20s is €41.96.
By getting a life insurance policy when you are younger, you lock in lower premiums, meaning they will never increase throughout the term of your policy.
This can result in significant savings over time and ensure that you will be paying a consistent, lower amount until the end of the policy term. This strategy not only makes life insurance more affordable but also provides long-term financial security.
Note that the costs and availability of coverage vary based on your individual circumstances. Factors such as your health, lifestyle, smoker status, participation in dangerous sports, occupation, and the type and amount of coverage you need all play a role.
Additionally, the duration for which you wish to be covered will also influence these aspects. Each of these factors is assessed by insurers to determine your risk level and, consequently, your premium rates and coverage options.
It’s Easier To Get Approved
Getting approved for life insurance is easier when you’re young and healthy. Insurance companies are more likely to accept your application if you’re healthy.
So, applying for life insurance while you’re young and healthy makes it much simpler to secure cover. Plus, if you wait until later in life, your options might be more limited.
Some illnesses you might develop as you get older can make it difficult to get a life insurance policy. For instance, if you had a stroke, insurance providers would carefully assess your application to determine whether to approve it and how much to charge for the policy.
get a quote today!
It Can Cover Funeral Costs and Expenses.
One significant reason to get life insurance in your 20s and 30s is that it can cover funeral costs and related expenses.
The average funeral cost in Ireland is approximately €6,250, including various essential expenses. The funeral director’s fee alone can be around €2,300, covering services like organising the funeral, managing paperwork, and facilitating the ceremony.
Additionally, a headstone typically costs around €1,500, adding to the overall expenses. Securing a burial plot is another significant cost, usually about €1,200. The interment also adds to the financial burden, with an average cost of around €1,100.
Life insurance ensures that your family won’t face the substantial financial burden of covering these expenses out of pocket.
It Provides Financial Security For Those Relying on Your Income
Whether you are single, a newlywed, a single parent, or married with children, life insurance offers peace of mind and financial stability for those relying on your income.
Even if you don’t have dependents now, future plans might include starting a family. A life insurance policy ensures that your family is financially protected in case anything happens to you, covering daily expenses and future needs.
This security can also extend to ageing parents, a sibling with special needs, or other family members who might depend on you financially.
Paying Off Debts and Loans
Most financial institutions will simply pass these debts on to your estate – and interest will continue to accrue until they are repaid in full. Meanwhile, your family may be waiting for funds from your accounts to be released to cover daily expenses, funeral expenses or other costs.
Life insurance can cover these outstanding debts and loans. Whether it’s student loans, car loans, the payout from a life insurance policy can relieve your family from financial burdens. This is particularly important if you have co-signed loans or other shared debts.
This will ensure that your financial obligations are covered, preventing additional stress to your family during such a difficult time.
It Provides Benefits While You’re Alive
You might think life insurance benefits only come into play after your death, but there are various advantages associated with life insurance that can indeed benefit you while you’re alive.
For instance, certain policies offer a daily cash benefit for each day you spend in the hospital. Its primary objective is to assist in covering out-of-pocket expenses, including meals, transportation, and parking fees, which may not be included in your private health insurance cover.
Explore more benefits by reading our article “Benefits you can enjoy from life insurance while alive”.
get a quote today!
Which Type Of Life Insurance Is Best For Young Adults?
When it comes to securing your family’s financial future through life insurance, you have several options to consider. You can opt for a standalone life insurance policy that provides a payout in the event of your or your partner’s death.
Alternatively, you might combine different types of insurance to ensure comprehensive cover. For instance, Serious Illness Cover can be added to your policy to protect against specified critical illnesses, while Income Protection Insurance can provide financial support if you’re unable to work due to injury or illness.
Term Life Insurance
Term life insurance provides a lump sum payment to you and your family in the event of death. This type of life insurance applies to a specific fixed term; the policy will cease after the term has ended and no claim is made.
Whole of Life Insurance
Whole of Life Insurance will insure you for your entire life, continuing up until the event of your death. In most cases, this type of life insurance will cost considerably more than other products as there is a guaranteed payout.
Convertible Life Insurance
Convertible Term insurance is similar to Term insurance but has a different advantage.
The policyholder can convert the existing cover into a new, longer-term policy without requiring the insured person to provide further medical information at the time of conversion.
Read more about Convertible Life Insurance.
You can also change the policy to a “Whole of Life” policy, which guarantees you life insurance for the rest of your life.
Mortgage Protection
If you pass away before paying off your mortgage in full, Mortgage Protection insurance will cover the remaining balance.
Read more in our post about the most frequently asked questions about mortgage protection and the myths surrounding it.
Life Insurance – Types of Cover For Young Adults
Single
Getting a quote by yourself and taking out a single policy.
Joint
This policy covers you and your partner and will pay out once. This policy can either be set up on a Joint Life First Death basis, i.e., the policy will pay out on the death of the first life assured, and cease.
Or on a Joint Life Second Death basis, i.e., there will be no payment on the death of the first life assured, however, the policy will pay out on the death of the second life assured and then the policy will cease.
Dual
Dual cover will pay out on the death of both the first and second lives assured. On the death of the first life assured, the benefits will be paid to the remaining life assured.
The benefits will be paid to their estate upon the death of the second life assured. Once the policy has paid out on both the first and second lives assured, it will cease.
get a quote today!
How Much Life Insurance Cover Do You Need As a Young Adult?
When planning for life insurance, a valuable resource is the life insurance calculator. This tool provides an estimated amount of life cover you might need, acting as a guideline to assist in your preliminary calculations.
Additionally, you can request a quote directly through our service, which compares the best life insurance providers in Ireland all in one place. This convenience allows you to shop around without the need to visit multiple websites—we do all the work for you.
Are you wondering why purchasing life insurance through a broker might be your best choice? Brokers can offer personalised advice and access to a broader range of products than you might find on your own, with better prices!
To understand the advantages in more detail, read our article on why buying life insurance from a broker could be more beneficial for you.
Is It Possible To Adjust Our Life Insurance Cover Over Time?
Many life insurance policies offer flexibility, also known as Guaranteed Insurability. Policies with a guaranteed insurability option allow you to increase your cover when significant life events occur, such as the birth/adoption of a child or the purchase of a home, without providing additional medical evidence.
Additionally, you can add Indexation to your life insurance policy, which ensures your cover increases over time to compensate for inflation.
This feature helps maintain the value of your policy, providing adequate protection for your loved ones as the cost of living rises. By adjusting your cover to keep pace with inflation, you can ensure that your beneficiaries receive sufficient financial support when needed without the risk of your policy’s value diminishing over time.
By reading our article, you can learn more about how inflation can impact your life insurance payout.
Can I Get Life Insurance If I’m a Smoker?
Absolutely. Many smokers successfully apply for life insurance, so not only is it possible, it happens frequently.
However, there is a catch. Your status as a smoker will impact the insurer’s decision to provide coverage and will likely affect your premium—the amount you pay for your coverage.
In a nutshell, if you are a smoker, your premium is likely to be higher than that of a non-smoker.
For example, a non-smoker could pay as little as half of what a smoker applying for the same coverage would pay.
Read more in our article, How Quitting Smoking Can Significantly Reduce Your Life Insurance Costs.
Can Serious Illness Cover Be Included in a Life Insurance Policy for Young Adults?
Yes, you can add Serious Illness Cover to your Life Insurance or Mortgage Protection policy, which pays out a lump sum if you are diagnosed with a specified serious illness.
If you add serious illness cover to your Mortgage Protection or Life Insurance when the payment is made, the life cover amount is reduced accordingly. This is also called accelerated serious illness cover.
Alternatively, you can buy Serious Illness Cover as a separate policy. It’s called Standalone Serious Illness Cover and it means it is taken out as a separate policy and it is completely independent of any life protection you might purchase or already have. It is sometimes called additional, separate, or double cover.
To understand better, read our detailed article about Serious Illness Cover where we explain everything in depth.
get a quote today!
Other Important Insurances For Young Adults
Serious Illness Cover: This policy offers protection by providing a lump sum if you are diagnosed with a specified serious illness. Learn more by exploring our Serious Illness Cover Guide.
Income Protection Insurance: Provides a regular income if you cannot work due to illness or injury. Learn more by reading our Income Protection Guide.
Health Insurance: This insurance provides cover for medical expenses, reducing the financial burden of healthcare costs for you and your children. Learn why health insurance is a must-have in Ireland.
Pension Plans
Contributions to a Pension: Besides providing for retirement, pensions can sometimes offer a death-in-service benefit, which provides a payout to dependents if you die while employed.
Read our Retirement Guide to learn everything about pensions and retirement planning.
Should I Get Life Insurance if I’m Covered Through Work?
There is a myth that if your employer provides life insurance, you don’t need to buy your own policy.
While it’s true that some employers in Ireland offer life insurance policies as a benefit, providing a lump sum of three to five times your annual salary to your family in the event of your death, this coverage might not be sufficient.
Additionally, if you change jobs, you might lose this coverage. Having your own policy ensures continuous protection, regardless of your employment situation.
Get a Life Insurance Quote For Young Adults
Speak with one of our financial advisors, who can guide you, help you understand your options, and ensure you get the best possible policy for your situation.
Whether you’re looking for term life insurance, whole-of-life cover policy, or a specific plan tailored to your circumstances, LowQuotes provides the tools and information you need to make an informed decision.
We also provide various financial services, such as mortgages, serious illness cover, income protection, pensions, financial planning, health insurance, and savings & investments.
get a quote today!
All our content has been written or overseen by a qualified financial advisor. However, you should always seek individual financial advice for your unique circumstances.
