Life insurance is something many of us have for simple peace of mind. It is “just in case” insurance that will take care of our family and loved ones if something tragic or unexpected were to occur. However, for some professionals, such as pilots, the nature of the career can make it more difficult to find a reasonable and budget-friendly life insurance policy.
Even so, providers that do offer life insurance for pilots will still offer the same three basic types of policies: term, universal, and whole.
Term Life Insurance
Just as with the general public, term life is probably the most common type of insurance purchased by professional pilots. This type of policy covers the pilot for a stated term. These policies tend to be cheaper because they are limited in time and once the policy date expires, there is no pay-out. For this reason, these policies are often easier to secure.
In some cases, insurance companies will allow the policyholder to convert the policy over to one of the other options.
Universal Life Insurance
This type of insurance is the mid-range choice and while it will cost more than term, it is not quite as expensive as whole of life. This type of policy is generally in effect from the date it is secured until death (assuming monthly premiums are paid in full and on time).
The guaranteed pay-out upon death is very attractive to policyholders. The one drawback to this type of insurance is that if it is secured at a young age, you could actually pay more into the policy than the face value of the policy upon death.
Whole of Life Insurance
While this does cost more than either of the above types of insurance, it will also have the biggest pay-out upon maturation. Unlike a term policy, a whole of life policy never expires. Unlike the universal policy, this is more of an investment where the dividends and/or interest are earned over the life of the policy and paid out at death.
For example, if you secured a £100,000 policy at a young age and lived into your 70s, it is very likely your family will receive benefits far in excess of the stated value of the policy.
What Type of Insurance is Best for You?
This is a personal decision that is often based on two major factors: health and budget. Someone in top physical condition will have more options, but there are policies available that do not require a physical. Your budget will also affect your choice, as you simply may not be able to afford universal of whole of life at this time. For pilots looking for life insurance over 60’s there are actually a good range of cover plans available.
You are best served to discuss all options with a professional agent or broker before making a final decision on your own.
