Nobody likes to think about death, but if the worst should happen, then you need to be prepared. Leaving your loved ones without an insurance policy or a will can make a difficult time even harder, so you need to make sure you can bring them a bit of reassurance once you are gone. You can compare life insurance plans to find the best one that will suit you and your family.
Do you actually need it?
The best way to determine whether you truly need life insurance or not is to consider your financial obligations. Think about the impact your death could have on your loved ones – would they be able to make mortgage payments and could they afford to eat? You need to think especially hard if you do not have a death-in-service policy in place, sellable assets, investments, or savings that can be left to your next of kin.
If you have taken out a mortgage this means you have a lengthy financial obligation to fulfil that will have to be dealt with after your death. Your funeral will also be a costly event no matter how small or modest it is. If you have little or no provisions to cover your loved ones, then life insurance is definitely something you should look into.
Why do people buy life insurance?
Buying a new home – If you die before you fully pay off your mortgage then the responsibility to complete payments will likely fall to someone you love. Life insurance means you can be proactive in making sure those you care about can meet such a big financial commitment after you have gone. For this specific purpose you can get decreasing cover life insurance – the longer you have the cover in place, the less it pays out.
Just married – When you get engaged or married you are joining families and assets, so it makes things much easier if you know that you are both covered should one of you pass away. Life insurance means you can make contributions to your partner’s well-being to protect them after you have gone. You can take out a single policy, but a joint policy can be cheaper than two singles – however, in most instances, it only pays out once. So, if you make a claim, then you are no longer covered, and the surviving partner would have to take out their own policy after that.
Having a baby – Raising a child is very expensive, especially if you want to pay for private education or make university contributions. If something were to happen to you as a parent, you would rather have something in place to protect them.
Planning for your funeral – The British Seniors Funeral Report 2021 found that the average cost of a ‘basic’ funeral between 2016-2021 was around £5,631. One of the best ways to help your loved ones pay for your funeral is to take out a life insurance policy. Over 50s life cover is a popular choice for those ready to think about their funeral because it simply exists for as long as you live and pays out a lump sum upon your death.