NHS employees actively contributing to the NHS pension scheme are entitled to death in membership benefits[1].

This includes life assurance and pension benefits.

Frontline NHS and Social Care workers may also be eligible for the Coronavirus Life Assurance Scheme.

The scheme offers a £60,000 pay out to families of those who pass away as a result of COVID-19.

This is a helpful guide from Reassured on life insurance for nurses looking for cover on top of what they receive as part of the schemes.

At Reassured, we make arranging personal life insurance as effortless as possible, so that you can get back to enjoying your much-needed downtime.

Our dedicated life insurance consultants are here to answer any of your questions and provide all the information you need.

Read on to learn more about life insurance for nurses...

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Life insurance for NHS staff

As mentioned, as a nurse you may already be entitled to death in membership benefits as part of the NHS pension scheme.

The scheme provides a lump sum pay out and pension benefits to your loved ones if you were to pass away during the membership.

The amount you receive will depend on your circumstances at the time of your passing but is usually a multiple of your salary or pension.

The Coronavirus Life Assurance Scheme was established to protect the families of frontline NHS and social care workers, whilst they bravely continue to work during the COVID-19 outbreak.

If you’re eligible, then you may wish to factor in the £60,000 of free cover from the scheme when arranging individual life insurance.

How much life insurance do you need?

Enter your financial commitments to understand the level of cover you require.

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£121,687 is the estimated average outstanding mortgage per household in the UK.

Our property is generally the largest financial commitment any of us will make.

Your life insurance should cover this significant debt should you no longer be around.
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According to Money Advice Service, full-time childcare in the UK now costs £242 a week.

The loss of a parent could result in the need for additional childcare whilst the surviving parent increases their hours to account for lost income.

Your life insurance cover should factor in this additional required outgoing.
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The average level of debt (minus a mortgage) in the UK is £15,385.

Factoring in any outstanding debts in your name when arranging life insurance ensures this burden is not passed to loved ones.
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You may wish to leave your loved ones an inheritance or lump sum gift upon your passing.

Factoring in the gift amount when arranging your cover will ensure the pay out amount will be sufficient to provide your loved ones with this selfless gesture.
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According to SunLife, the average cost of a UK funeral is now £4,417, whilst the total cost of dying is £9,493.

This is a 130% increase over the past 16 years and shows no signs of slowing down.

A significant cost which should be factored into the amount of life insurance you secure.
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If you are one of the 65% of the UK who are lucky enough to have savings, this could be used as protection if you were to pass away.

Any pay outs from existing life insurance policies and investments can also be used as financial protection for your loved ones if you were no longer around.

Factor this into your required cover amount.
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Your total cover estimate

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Individual life insurance for nurses

Firstly, a personal life insurance policy can be tailored to your specific needs and budget.

You’d have more control over the following aspects:

  • The policy type
  • Cover amount
  • Term length
  • Pay out distribution

Having an individual policy could also ensure that your loved ones are provided with the utmost protection during and after you employment with the NHS.

This offers protection in case you were to retire early and your death in service benefits with the NHS pension scheme are reduced.

Or, if you were to leave the nursing occupation and your death in service benefits no longer apply.

A life insurance pay out can ensure that your loved ones are able to afford:

  • Mortgage or rent
  • Daily living costs or household bills
  • Funeral service
  • Outstanding debts
  • Childcare fees

Cost of life insurance for nurses

The cost of your life insurance will depend on your individual circumstances.

Life insurance premiums are calculated based on the level of risk posed to the insurer.

The following factors are taken into account as standard:

  • Age
  • Health/medical history
  • Smoking status
  • Lifestyle
  • Policy type
  • Length of cover
  • Level of cover (sum assured)

Some insurers may consider nursing as a high-risk occupation and therefore may charge higher premiums.

That’s why it’s important to compare quotes from a variety of insurers.

You can use our award-winning, no-fee broker service to do this.

Life insurance arranged through Reassured could start from a few pounds a month.

Life insurance for nurses application

The COVID-19 outbreak has placed emphasis on the risks that frontline nurses and healthcare workers face.

Going forward, insurers may take into account the threat of emerging and re-emerging infectious diseases.

As a result of the outbreak, many insurers have introduced a set of new coronavirus related health and travel questions for all new policy applications.

Therefore, making it more important than ever to compare quotes to receive the best available deal.

Read on to learn the different life insurance policy options.

Term life insurance

This type of policy provides a cash lump sum pay out if you pass away whilst cover is in place.

The sum assured can be up to £1,000,000 depending on your needs.

You’d be able to specify the term length of the policy, up to 40 years.

Term life insurance can offer your family the protection they need if the worst were to happen to you during your working life.

Particularly if you have dependants that rely on your income as a nurse.

There are two types of term life insurance; level and decreasing.

Level term

  • Level term policies provide a fixed sum assured throughout the term of the policy
  • More common for covering an interest-only mortgage, as the sum assured remains fixed to cover the total value of the property and the mortgage can be paid in full
  • Generally more expensive than decreasing term cover
  • Can be taken out as a joint policy
  • Can be written in trust
  • You could outlive the policy

Decreasing term

  • Decreasing term policies provide a decreasing sum assured throughout the term of the policy
  • More common for covering a repayment mortgage, as the sum assured can decrease in line with the remaining balance of the mortgage
  • Generally the cheapest form of cover
  • Can be taken out as a joint policy
  • Can be written in trust
  • You could outlive the policy

At Reassured, we have a team of highly experienced consultants who are happy to answer any questions and provide information you need regarding your life insurance options.

Family income benefit

Family income benefit (FIB) key points:

  • Helps long-term family budgeting
  • Provides loved ones with a regular, tax-free monthly payment
  • Fixed, low-cost monthly premiums
  • Medical questions asked
  • Monthly pay out up to £5,000
  • Term period from 5 to 40 years
  • Payments continue every month until the end of the policy term

Family income benefit or FIB is another form of life insurance that provides cover during a specified term.

The difference is that instead of a cash lump sum pay out, FIB provides a regular tax-free monthly income to dependents.

Essentially, FIB replaces a lost income and ensures that loved ones can continue to pay the mortgage or rent, cover daily living costs and pay for childcare.

Whole life insurance

Whole of life insurance key points:

  • Protection in place for the rest of your life
  • Guaranteed cash lump sum pay out
  • Medical questions asked during application
  • Level of cover up to £1,000,000
  • Premium payments for the rest of your life (or until a certain age)
  • Includes terminal illness cover as standard

Whole of life insurance is a form of life assurance, which means a pay out is guaranteed when you pass away.

As discussed, life assurance is available for nurses with an active membership with the NHS pension scheme.

Though the pay out amount is variable depending on your circumstances at the time of your passing.

A separate, personal whole of life policy could be arranged with a larger, fixed sum assured to ensure your loved ones have the full amount of financial protection (or to an enjoy as inheritance).

Whole of life is most suited to those in the later stages of life and in good overall health.

This is because premium payments are required for the rest of your life, and therefore it’s possible to pay more into the policy than is paid out.

Whole of life insurance can be arranged through Reassured from just 27p-a-day.

Joint life insurance

Joint life insurance covers two lives simultaneously on one policy.

A joint policy could save you approximately 25% on your premiums, as it pays out only on the first or second death.

Critical illness cover

Critical illness cover provides a tax-free lump sum pay out if you’re diagnosed with a serious, yet non-life threatening illness.

Critical illness cover can be added alongside a life insurance policy for an additional cost.

Illnesses include certain cancers, stroke, MS and heart attack.

Writing your policy in trust

As mentioned, having your own personal life insurance provides you with some control over how the proceeds are spent after you pass away.

You can do this by writing your life insurance policy in trust.

This is a free option where you’d place a person you trust in charge of your policy.

The trustee will then manage the pay out when the time comes and distribute the funds according to your wishes.

At Reassured we provide a free trust service on the majority of the policies we arrange, helping you through the application and answering any questions.

Life insurance for nurses quotes

Searching for suitable life insurance and comparing quotes is a time consuming and sometimes daunting task.

But it doesn’t have to be, as at Reassured we can compare multiple quotes to help you find the best price.

We compare multiple quotes to help you find the best price.

Our service doesn’t stop there as we also guide you through the application process and answer any of your questions.

Our FCA-regulated and award-winning broker service is completely free of charge to use.

Get in touch with our dedicated team today to get started.

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Sources:

[1] https://www.nhsbsa.nhs.uk/nhs-pensions

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