Expat Life Insurance
Are you living abroad with your family? For expats with dependents, a global life insurance policy should feature in their plans to secure your families future. If you have never thought about this topic before, our guide to international life insurance gives a helpful overview.
The most comon form of life insurance is often called “term insurance”. If you should die during the agreed-upon insurance period, the designated beneficiary of the international life insurance plan will receive a certain sum. The money will help them to cover outstanding medical bills, repatriation of remains, funeral expenses, and similar costs.
However, most owners of a life insurance policy would like to obtain a far greater degree of protection for their loved ones. Therefore, you should carefully calculate the amount of the lump-sum payment provided by your international term insurance.
Life insurance companies sometimes quote general rules of thumb for the amount your policy should cover, e.g. five or ten times your annual gross income. Actually, it makes more sense to review exactly what your family may need. This often includes:
further costs for settling the estate (especially inheritance taxes)
income protection for the surviving partner
financial reserves for your children’s education
emergency funds to cover unexpected expenses
savings for paying off a mortgage or debts
In the latter case, some kinds of term insurance are tailored to the specific needs of people with mortgages or large debts. The final amount – i.e. the sum needed to clear your debts – will gradually decrease as the years progress and you keep paying off what you owe. Premiums for such a plan are usually lower than for the usual kind of international life insurance.
How costly the premiums for your life insurance are does not only depend on the type of policy you choose. It is frequently influenced by a variety of other factors, e.g.:
the total amount of the insurance sum
the age of the insured
their gender (although EU legislation now mandates unisex tariffs)
their health (especially if they smoke)
their hobbies (if these include hazardous activities, e.g. extreme sports)
their place of residence
the length of the life insurance term
Moreover, even with the same factors, quotes may vary from company to company. Always have several life insurance quotes and plans to compare.
The insurance period, or “term”, can generally be chosen at your own discretion. An expat might benefit from shorter contract with more flexibility. However, they may want to ensure that they can renew or adjust their life insurance once they return home and/or the term expires.
If you want to keep your life insurance, even once you give up your globe-trotting ways, the financial situation of your dependents should determine the length of the term. For instance, your plans might cover the years till your spouse reaches retirement age and is entitled to their own old-age pension. Or you want to offer your children funding until they graduate and find a job.
In addition to the potential exclusion of high-risk locations, there are further details to consider when it comes to international life insurance. Is the policy “portable”? Will it remain valid while an expat moves from country to country, or does the contract need adjusting for each international relocation? Do you need to prove some intention to return to your home country in the foreseeable future? Or is the offer truly international and will cover you even if you decide to emigrate? Do your survivors need to return home in order to claim the life insurance benefits? Or will they receive the money abroad? In which currency are the life insurance premiums and benefits paid?
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If you would like to receive a free quote for any of the life insurance plans, complete the easy form at the top of this page. One of our life insurance specialists will be happy to assist you.
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