Ladies, let's talk about life insurance

I’m single, working and renting

There is a common misconception that people only need life insurance or related policies if they have a mortgage, or financial dependents. This is simply not true! 

It’s so important for those who are renting to consider what might happen if they were unable to work due to illness or injury - would they be able to cover their rent and living costs? What kind of sick pay or benefits are available through work or the government? 

Two examples of insurance policies available through Cavendish Online which may help alleviate financial stress on renters should they be off work due to illness or injury, or be diagnosed with a critical illness are: 

Income protection is a type of policy which would pay out a monthly benefit if you were to be unable to work due to an accident or sickness. 

Should you be signed off work by your GP, the policy is designed to pay out a regular monthly income (subject to any policy exclusions). You can set the policy to cover up to 65% of your gross annual income or an amount that just covers your rent and bills. In the circumstances detailed above this would mean that whilst you are recovering from an accident or sickness, you can help ensure that your monthly outgoings are covered. There are several types of Income Protection policy to suit a range of needs, so speak to an adviser to get more information and quotes which are tailored to your current situation, 

Critical Illness Cover is another type of insurance policy that could support you should you become severely unwell, however works in a slightly different way to Income Protection. 

A Critical Illness policy would provide you with a singular lump should you be diagnosed with an illness which meets your chosen provider's definition and specified severity. The pay-out from such a policy can be used however you see fit to help you recover - for instance to make adaptations to your home, purchase a mobility vehicle or simply to help maintain your standard of living whilst you get better. 

Every provider has a different list of what they define as a critical illness, however they typically all cover: cancer, heart attack and stroke. These conditions are horrible to have to go through, however with recent medical advancements, it is likely that you will survive. However, whilst going through one of these life changing illnesses, the last thing you need is the pressure of having to ensure your rent is paid and bills are covered.

I’m part of a dual income household, we have a joint mortgage and two young children

When it comes to a dual income household, it’s well worth considering covering all bases, where possible. Take some time to assess what financial commitments you and your family have that would need to be accounted for should the worst happen. This will give you a good starting point for working out how much life insurance you need - if you need a hand with this then speak to an adviser  who can help talk through this with you. 

The first thing I would suggest is to think about is protecting your mortgage. 

Mortgages are often one of the largest financial commitments for any household, so it’s always worth considering how you would cope financially should something happen to either of you. One of the most common ways to protect a mortgage is through a term based life insurance policy. 

A term based life insurance policy is designed to pay out a lump sum in the event of you passing away during the policy term. This money could then be used to pay off the mortgage, meaning that your family would not have to worry about having a roof over their heads whilst grieving the loss of a loved one.

Many people who have a joint mortgage choose a joint life first death policy because it can often be cheaper than two single policies and pays out on the first death, allowing the surviving policyholder to clear the outstanding mortgage debt if they wish to. Learn more about joint life insurance.

If you would like to know more about life insurance for mortgages, or the differences between single and joint life policies then head to our ‘Latest News’ section of the website for more information. Alternatively, call us on:

01392 463 193 

Those with financial dependents may also wish to consider some form of family and lifestyle protection. 

It’s not nice to think about, but in the event of something happening to you or your partner, would your loved ones be able to maintain their standard of living? 

Two types of policies which are often used to provide protection for family and lifestyle needs are: Term based Life Insurance or a Family Income Benefit policy. 

A Term-based Life Insurance policy would pay out a singular lump sum in the event you were to pass away during the policy term. Your family could then use this money to help cover their cost of living. 

Family Income Benefit would pay an annual or monthly lump sum for your family over a set amount of time in the event you were to pass away. One of the main reasons people opt for a Family Income Benefit policy is because the consistent income to the household (which such a policy would provide) may be easier to budget with.

As always, when it comes to what type of policy is best for your family it depends on your individual circumstances. If you are unsure what is best then consider speaking to an adviser.

You may also choose to consider some form of sickness cover either in the form of an Income Protection policy or a Critical Illness policy. 

An Income protection policy would pay out a monthly benefit if you were to be unable to work due to an accident or sickness. 

Should you be signed off work by your GP, the policy is designed to pay out a regular monthly income (subject to any policy exclusions). You can set the policy to cover up to 65% of your gross annual income or an amount that just covers your regular household expenditure. 

Such a policy would help ensure that if anything were to happen to you then you know you will have some form of income every month and can help cover your regular outgoings. This financial safety net eases the burden of uncertainty regarding money coming into the household, which gives you the time to focus on recovery.

There are several types of Income Protection policy to suit a range of needs, so speak to an adviser to get more information and quotes which are tailored to your current situation, 

A Critical Illness policy is designed to provide you with a singular lump sum in the event you were to become unwell with a serious illness.

The pay-out from such a policy could be used however you see fit. For example, to hire some additional help at home, or to allow your partner to take some time off work to care for you through this tough time. Some may also choose to use the pay-out to make adaptations to their homes or vehicles if necessary. 

With a critical illness policy you can also add children’s cover. 

Each provider varies on what they offer (so check your policy summary for more details on this), for instance some providers cover childrens’ specific illnesses and offer a range of additional supporting benefits. This extra financial support means you can focus on being there for your little one when they need you the most.

I’m a homemaker

Many homemakers we have spoken to over the years have sadly overlooked the impact on their household’s finances should something happen to them, as they are not directly bringing in an income.

However, if anything happens to the homemaker, what would happen to the household? Who would take care of any children and ensure everything is running smoothly? In this eventuality, it often falls on a partner or other family members , which would then result in them having to either take time off work in order to help out or having to find additional money to be able to pay for home help.

Homemakers might want to consider cover which would help their partner look after the family should the worst happen. 

There are a wealth of options available to you if you are a homemaker, which can help support you and your loved ones in many different circumstances. 

A life insurance policy would provide your family with financial aid in the sad event of you passing away. The pay-out from such a policy could be used by your partner however they see fit to assist the household and help to maintain their standard of living. In addition to this, it may give them the financial breathing space they need to take time away from work to grieve and support the household through an understandably difficult time. 

Some might also choose to take out a critical illness policy, which can provide you with a singular lump sum in the event you were to become unwell with a serious illness. The pay-out from such a policy could be used however you see fit. For example, to hire some additional help at home, or to allow your partner to take some time off work to care for you through this tough time. Some may also choose to use the pay-out to make adaptations to their homes or vehicles if necessary. 

With a critical illness policy you can also add children’s cover. 

Each provider varies on what they offer (so check your policy summary for more details on this), for instance some providers cover childrens’ specific illnesses and offer a range of additional supporting benefits. This extra financial support means you can focus on being there for your little one when they need you the most.

I’m self employed and run my own limited company

When it comes to being self employed your business is everything. Whether you are flying solo or have a much larger business, getting some form of Business Protection in place to cover yourself (and the company!) is something strongly worth considering.

At Cavendish Online, we know that your business is as individual as you are, which is why we would always suggest you give us a call and speak to an adviser for a no obligation review of your business protection needs. Depending on the size and structure of your business, there are a range of life insurance solutions which can be tailored to you and your organisation. 

In this article we touch upon a handful of the most well known business protection options available through Cavendish Online. 

If you are self-employed it’s well worth considering what would happen if you were unable to work due to illness or injury - Income Protection is a great option if you have not made your own sick pay arrangements. 

Should you be signed off work by your GP, the policy is designed to pay out a regular monthly income (subject to any policy exclusions). You can set the policy to cover a percentage of your gross annual income or even just an amount that just covers your regular household expenditure. 

Such a policy would help ensure that if anything were to happen to you then you know you will have some form of income every month and can help cover your regular outgoings. This financial safety net eases the burden of uncertainty regarding money coming into the household, which gives you the time to focus on recovery.

There are several types of Income Protection policy to suit a range of needs, so speak to an adviser to get more information and quotes which are tailored to your current situation. 

There is also Relevant Life insurance, a stand-alone, single life death-in-service plan, set up and paid for by an employer (in this example - your limited company!). 

Relevant Life Insurance is designed to be a cost-effective way for an employer to arrange Life Cover for the benefit of their employees (even if they are the only one!), with the benefit of the policy being payable to the employee’s family or financial dependants - note that the business cannot benefit from the policy pay-out in any way. 

Relevant Life policies can be tax efficient for employers and employees, as long as it meets certain legislative requirements*.

*It’s recommended that the employer (normally through their accountant) checks with their local tax inspector to gain comfort for their own particular circumstances.

If you have several employees or even a much larger business, we can also help you set up a fantastic range of employee benefits (such as Group Private Medical Insurance, Group Life cover, Group Income Protection etc.) to attract and retain the best people to drive your business forward. 

If you would like to learn more about business protection, please see our Business Protection page. Alternatively, speak to an expert for a full review of your companies insurance needs today on:

01392 436 193