If you’re not sure on your current status regarding life insurance, now is a good time to look into it. Those policy documents might be stuffed in the back of a filing cabinet or in a box file somewhere in the loft - so if you’re not sure, get sure!
Life cover through work is certainly a good benefit to have, but you can’t always assume that this cover is adequate for your needs.
Some employee packages include a ‘death in service’ benefit. This covers you for a multiple of your salary that would go to nominated loved ones if you were to die whilst you worked for the company, so you might not even consider requiring an additional life insurance policy. Bear in mind however, there’s very little control you have in terms of individual cover levels and the moment you stop working for the employer, you’ll no longer be covered under that policy.
Understand what you’re buying
The two types of life insurance policies you’re most likely to come across are ‘term insurance’ (the more basic form of life insurance) and ‘whole-of-life’.
‘Term’ life insurance policies run for a fixed period of time (known as the ‘term’ of your policy) eg. 10, 15 or 25 years - but only pay out if you were to die during the term of the policy. There’s no lump sum payable at the end of the term.
With a ‘whole-of-life’ insurance policy, the clue is in the name. Unfortunately, we all die one day, so as this policy is ongoing, it will pay out a lump sum whenever that day comes.
Naturally, these policies are typically more expensive than term insurance policies since as long as you keep paying your premiums, the insurer will always have to pay out, whereas you may outlive a term insurance policy.
TIP: Whole-of-life insurance is also known as life assurance by many insurers.
If you’re not sure, speak to us, and we can help guide you to what’s the best option for you.
At Cavendish Online, we can help you find the best life insurance policy for you, as we wont limit your search to just one company. Get a quote online or call us today.