Decreasing Term Life Insurance (Mortgage Protection): Like term life insurance, this policy lasts a pre-agreed number of years but usually covers the length of your mortgage and then pays out if you pass away during that time.
However, unlike term life insurance, each year the potential pay-out decreases as it is meant to be used with a mortgage where the outstanding loan decreases over time. Due to this, this policy is usually cheaper than term life insurance.
Family Income Benefit Insurance: This insurance pays out a regular income during the agreed time period, rather than a lump sum at the end. Your loved ones will not need to change their standard of living if you match your current salary. Be aware that this policy won’t pay out for long if you pass away late in the term of the policy.
Covering your mortgage: Most likely, your mortgage repayment is your largest outgoing at the moment. Therefore, you won’t really want to leave your family with this burden if you are the main earner. With this in mind, a mortgage life insurance policy would be sufficient. It is worth noting that when you work out how much cover you need, it will benefit you to make sure the policy covers both the capital and interest repayments.
Any other loans: Again, just like with the mortgage, you won’t want to leave your loved ones with an unnecessary financial burden, therefore there are different types of policies to choose from which will suit you.
To establish how much cover you need, click to go to our contact page above.
Childcare expenses: If you have young children, then your presence in the family will be missed and we’re sure you’ll still want to put Frosties on their breakfast table after you’re gone. It is worth considering that your children may need to be cared for and this may need covering. Just how much you need will depend on how many children you have and how old they are.
Education fees: It is every parent’s dream for their children to get a higher education and this comes at a cost. There are policies available that will be able to cover your children’s university and school fees.
Replacement of income: It may be the case that when you pass away, your family is less likely to be able to live the same quality of life. There are policies that can cover your family from this loss of income. However, this is the hardest calculation to make as it requires working out how much your family may need in the future.
Of course, life insurance isn’t suitable for everyone, especially those who are single and have no dependents. However, it is something to think about if you will be leaving your family and children with financial burdens such as a mortgage.
Below are a few instances in which life insurance will be worth it:
If your family/partner relies on your income
If you have children who depend on you
If you have a property which a mortgage still needs to be paid
Even if you aren’t the main earner in the family, life insurance is still worth it. You just need to ask yourself if your family could survive without your financial backing.