You probably need life cover more than you think
Many people are confused by life insurance and do not fully understand what it is, or why they might need it. You may think you are too young, too independent or too wealthy to need this type of cover.
We believe, that many more people in the UK should be considering life insurance to protect their loved ones. Regardless of your age, or stage of life, there are always plenty of good reasons to take out life insurance to protect the people you care about most.
According to an article on www.thisismoney.co.uk, using research by MoneySupermarket.com, in the UK ‘£8.5 million adults with dependents do not have life cover in place‘ and this leaves an astonishing ‘cover gap of £263 billion‘.
When do people take out life insurance protection?
In our experience certain life events often trigger people into thinking more seriously about life insurance:
1) Purchasing a property
If you have just taken out a mortgage, whether on your own or as a couple, it is the perfect time to secure life insurance that will cover your mortgage debt in the event of your death.
Taking out adequate life insurance protects your loved ones and the family home if you were no longer around to help with the repayments.
Some mortgage lenders require you to take out life cover before they will agree to lend funds. Regardless, life insurance is a very good idea so as not to ever burden your family with an enormous property debt.
Normally a life insurance policy term will run alongside a mortgage term, so your family are fully protected long-term.
2) Starting a family
One of the most important periods of your life to ensure you are adequately insured is when you have children. During these early years, your children are obviously completely reliant on you for all their needs. What would happen if you were no longer around?
As soon as you find out you are expecting a baby, it is a good idea to make provisions for adequate life insurance to protect your family for the future.
Some thought should be given to the policy term and the level of protection you require. When working out how much cover you need to think about your living costs, monthly rent or mortgage repayments, travel costs, childcare expenses.
It is generally a good idea to make sure your policy protects your dependents until they are financially independent. Perhaps until they are 21 years of age, have left university and are likely to be in employment.
3) Getting married
Getting married is not necessarily a reason to take out life insurance, but the events that often follow close behind usually are. Things like buying a house, starting a family, or taking out joint loans, may mean you are now more reliant on your partner.
Now that you have legally cemented your relationship it is probably a good time to get your finances in order too and secure your future.
Remember life insurance is cheaper the younger you are, so it is a good idea to take your policy out sooner rather than later to secure the lowest premium.
4) Looking to retire
If you have planned well for your retirement and paid off your mortgage then you might not need such a large insurance policy.
Life insurance for the over 60’s can become expensive, but if you do not need such a high level of cover as you did in the past, it can make this more affordable.
Often more senior people will take out an over 50s plan to cover expenses like funeral costs or to leave an inheritance for their grandchildren. These policies guarantee a pay out on death and often premiums are very reasonable.
5) Single with no dependents
You might think that if you are single, living at home and have no dependents, then life insurance is not necessary. However, even if your passing would not leave your family in big financial trouble, it is generally wise to secure your policy while still young to lock in the cheapest rate.
If your family are not wealthy and you do die young, your parents could be left with unaffordable funeral expenses (average funeral in the UK is estimated at £4,000), credit card bills, personal loans, student loans or car finance debt.
When to take out a life insurance policy?
When it comes to life insurance, it really is a case of the younger the better.
The older you get, and the closer to death you become, the higher the risk to the insurance company that they will need to pay out.
This is reflected in the high cost of the premiums for older people, so it makes financial sense to lock in low premiums while you are still young, fit and healthy.
However, that doesn’t mean that older people shouldn’t be considering life insurance. There are many bespoke policies available designed to accommodate older people, such as over 50’s cover.
So whether it’s a policy designed to cover funeral costs, repay the mortgage or to pay off debts, there is suitable protection available for everyone.
Who will get the insurance pay out?
It is entirely up to you to decide who will benefit from your insurance pay out in the event of your death.
Most people will have the money paid to their spouse, their children or even to their parents depending on their situation.
However, your beneficiaries do not have to be related to you. If you have a lifelong friend, godchild or a helpful neighbour you want to benefit from your death, you can name them on your policy too.
Why use Reassured to secure your life insurance?
- We have vast experience securing 100,000’s of customers comprehensive life cover
- Life insurance is what we do, (it is all we do), every day
- We will search the market on your behalf, finding you the most competitive quotes
- 13,500 cannot be wrong! We have an ‘Excellent’ average Trustpilot rating – 9.6/10
- We are completely independent, impartial and never charge you a fee
- There is no obligation for you to take out a policy with us
- We are a non-advised brokerage. We just listen to your unique circumstances and identify the most suitable quotes.