Do I Need Extra Protection if I Have Life Insurance?

Having life insurance in place is a solid start when it comes to protecting your loved ones, but as everyone knows, life doesn’t always go as planned. Illness, injury, or a sudden loss of income can put real pressure on your finances, even if you already have life cover. 

In this guide, we’ll look at why having extra protection can make all the difference and how to check if your current life insurance cover is enough.

Is your current life insurance enough?

A lot might have changed in your life since you first took out your policy. For example, you may have bought a house, had kids or changed jobs. Each of these can have an impact on how much cover you need, which is all the more reason to review your cover.

You may find that your cover might not stretch as far as it once did, in which case you can increase the amount of cover. It may also involve switching policies, such as from a term cover to a whole-of-life cover.

If you're unsure if your cover is still adequate, it's worth considering whether the payout would be enough to clear any debts or obligations you have. You should also ask yourself if it would be enough for your family to be able to maintain their lifestyle in the long term.

Why it's worth having extra protection alongside life insurance

Even a small amount of extra cover can make a big difference, giving you peace of mind that you and your loved ones are protected no matter what life throws at you. Some of the main reasons it’s worth having extra protection include:

• Life insurance only covers death — it won’t help if you are unable to work due to illness or injury.
   

• Employer benefits like death in service or sick pay may not be enough, and usually stop if you leave your job.
   

• Extra protection can help cover household bills, mortgage payments, and other living costs.
   

• You can tailor the level of cover changes to your personal circumstances, commitments or income.

Additional types of protection to consider

Even if you already have life insurance, other types of cover that can help make sure you and your family are fully covered.

Critical illness insurance

Critical illness cover pays a lump sum if you’re diagnosed with a serious illness, such as cancer, a heart attack, or a stroke.

The money can be used where needed, such as to cover household bills, replace lost income, pay for private treatment, or even adapt your home if necessary. You can usually add it to an existing life insurance policy, which makes it easier to manage alongside your other cover.

Most policies will only pay out once, so it's essential to check what conditions are included.

Income protection insurance

Rather than paying out a fixed lump sum if you can’t work due to illness or injury, income protection replaces part of your salary. It usually pays a percentage of your earnings each month, up to a set limit, and continues until you return to work or until the policy term ends.

Some policies also include a waiting period before payments start, which can affect the monthly premium. This type of cover can be ideal if your employer doesn’t provide long-term sick pay or if your household relies heavily on your income for everyday expenses.

Family income benefit

Family income benefit is slightly different from a standard life insurance policy. Instead of a lump sum, it pays a monthly income to your family if you die during the policy term.

Payments usually continue until the end of the term, which could be timed to match a mortgage or until your children are financially independent. It can provide ongoing support to your family, rather than a one-off payment.

What about your work cover?

You also need to take into account any policies offered by your employer such as key person insurance. These policies can complement your personal insurance needs and sometimes provide financial protection at no additional cost to you.

Death in service benefit

Many employers offer this as part of their benefits package, usually paying 2–4 times your salary if you die while employed. It’s a great perk to have, but it shouldn’t replace personal life insurance, as you usually lose it if you change jobs.

Employer sick pay

If you’re only entitled to Statutory Sick Pay, income protection can help bridge the gap. Relying on workplace benefits alone can leave you exposed if your circumstances change or if your employer reduces or stops those benefits.

Not every employer will offer the same benefits. For example, if you're self-employed, managing your financial safety net is your responsibility. Because of this, you will need to have your own cover.

When extra protection might make sense

Not everyone needs extra cover, but it can be a real lifesaver in certain situations. It’s worth considering additional protection if:

• You’ve recently taken on a mortgage or other financial commitments.
   

• You have children or dependants who rely on your income.
   

• Your employer benefits are limited or could change.
   

• Your savings wouldn’t cover several months of bills if you couldn’t work.
   

• You want to make sure illness, injury, or loss of income wouldn’t put your family under financial strain.

If your life insurance is up to date, adding other types of protection can give you more complete security and peace of mind.

How to decide what’s right for you

The best way to work out what cover you need is to look at your protection as a whole.

Start by looking closely at your financial commitments, income, and savings.  and think about how your family would manage if something unexpected happened. Doing so could help you decide whether extra protection is worth it and which type of cover would be most useful.

It’s also a good idea to review your life insurance regularly, especially after any major life changes like buying a home, having children, or changing jobs. Even if you have a policy in place, your needs may have shifted over time, and a quick check can help you make sure you’re suitably covered.

Where to get advice

Choosing the right level and type of cover can feel complicated, but you don’t have to do it alone. Our friendly team of advisers can help you review your existing life insurance and recommend the right combination of policies for your circumstances.

If you’re unsure about whether you need extra protection or what type is best, speaking with Cavendish Online is a simple way to get clarity and peace of mind. Call us today on 01392 43 94 37 for guidance.

Where to get advice

Choosing the right level and type of cover can feel complicated, but you don’t have to do it alone. Our friendly team of advisers can help you review your existing life insurance and recommend the right combination of policies for your circumstances.

If you’re unsure about whether you need extra protection or what type is best, speaking with Cavendish Online is a simple way to get clarity and peace of mind. Call us today on 01392 43 94 37 for guidance.