No one wants to think about the worst-case scenario, but the reality is that accidents can happen at any time. As a result, it's essential to protect your family's financial future if an unforeseen tragedy occurs.

One way you could do that is by investing in family life insurance. This type of insurance may provide a safety net for your loved ones in the event of your death. It could also, help ensure they have money to cover expenses and maintain their quality of life.

What is family life insurance?

Family life insurance refers to a form of life insurance used to protect your family and/or loved ones in the event of your death.

It pays a lump sum when you pass away. This could help maintain your family's standard of living and cover funeral costs and outstanding debts. It can also provide some peace of mind for those concerned about their family's future.

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Benefits of Family Life Insurance

Family life insurance offers a host of benefits, such as:

  • Financial protection - Your family receives a cash lump sum or a monthly/annual benefit should you die. This helps ensure that they are protected from the loss of your income.
  • Peace of Mind - Know that your family and/or loved ones have protection in place to help them remain financially secure. This could allow you all to focus on other aspects of life without worrying about the future.
  • Lifestyle Protection - Having a policy in place can help protect your family’s lifestyle and standard of living. It may provide money for ongoing expenses, such as household bills, childcare costs, education fees, or other major expenses.
  •  Support for any children -Your policy could provide an income to your dependents, such as children. It may also leave a legacy, helping them buy their own home.
  • Debt Protection -Life insurance could help protect your family from any debts you may have left behind. This might include mortgage payments, loan repayments or other financial obligations.
  • Flexibility - Life insurance policies can offer flexibility, allowing you to tailor it to fit your needs and budget.

What are the 3 main types of life insurance?

No matter what your circumstances are, consider the main types of life insurance. Each policy has its own pros and cons. So it’s important to assess your personal needs and financial goals before choosing.

Whole life insurance

Whole life insurance is a type of permanent life insurance that can provide cover for an entire life. However, whole life insurance can typically come with high premiums.

The policy has a fixed premium rate, meaning your monthly premiums stay the same even as you get older. The payout value also remains fixed during this time.

Term life insurance

Term life insurance offers protection for a specified length of time, often between 10-30 years. Unlike whole life insurance, it doesn't accumulate cash value and is generally less expensive.

It could be ideal for those who want to protect their loved ones during a specific period of time. For example, young families who have a mortgage to pay.

There are 3 levels of term life cover:

  • Level term life insurance - both the payout value and premium rate remain fixed during the policy term.
  • Decreasing term life insurance - used to cover large debts, such as a mortgage. The payout value can decrease over time as you make repayments. The premiums remain fixed, but are generally cheaper than level term cover.
  • Increasing term life insurance - can protect the value of your policy from inflation. The payout may rise over time as a result.  However, this also adds an increase to your premiums.

Please note: The insurance products offered by Cavendish Online have no cash-in value at any time. If you stop paying your premiums your cover will stop, your policy will end, and you will receive no benefit. If you have not claimed before the end of your chosen policy term, the policy will end, and no benefit will be paid.

If you are facing financial difficulties and can no longer afford your premiums, please contact your insurer as soon as possible to stop the plan from lapsing automatically. They may have a scheme that allows you to keep the cover.

Joint life insurance

Joint life insurance covers two people, usually spouses or partners, under one policy. The main benefit of joint life insurance is that it may be more affordable than purchasing two separate policies. It typically pays out when the first person passes away, providing support for the surviving partner.

You can also buy a joint life insurance plan that pays out on the second death, but these are typically only available over the phone. If you are interested in getting a quote one of these policies, please call our advisers on 01392 436 193 (Monday-Friday: 9am - 5.30pm)

Alternatives to family life insurance

If a family life insurance policy isn't the right fit for you, there are a few other options available. These include:

Family income benefit

Family income benefit could help replace your income, by paying out in monthly or annual instalments, making life easier for surviving family members. The benefit payments may cover a range of costs, including mortgage payments, rent, utility bills, education fees, and other regular outgoings.

Some people may find the instalments easier to use in their budget than a large lump sum. The premiums for this plan remain fixed for the lifetime of the policy.

Critical illness cover

Critical illness cover can be taken out on its own or as an add-on to life insurance. It pays out if you become seriously ill or injured and are unable to work.

Examples can include - heart attacks, stroke, or cancer, and each provider has their own terms & conditions, so be sure to compare plans to make sure you get the plan you want. The payment could be used to cover medical expenses and other costs associated with your illness.

 Premiums for critical illness cover usually remain the same, unless you have opted for an increasing plan, in which case the sum assured and premiums will increase over time.

Income protection

Income protection insurance may provide financial security if you’re unable to work due to an illness or accident. It pays a regular income, if your claim is eligible, directly into your bank account on a monthly basis. This could cover living costs and other bills while you’re off work, so you can focus on your health Income protection premiums are fixed unless you have opted for an increasing plan.

This policy usually has a deferred period (a waiting period) before it starts to pay out. You can choose how long you wait and keep it in time with your sick pay period, i.e. one month, six months, 12 months etc.

Death in service benefit

Death in service cover is typically offered to employees by their employer. It’s designed to support your family in the event of your death, whilst employed by the same company. This type of policy may pay a lump sum to your family and/or loved ones, typically between two and four times your annual salary.

How much cover do I need to protect my family?

When it comes to protecting your family, you should think about how much your family or loved ones might need after you’re gone. The amount of cover could depend on factors, such as your income, debts, and financial commitments of your family.

Ideally, it should provide enough money to cover any financial obligations, whilst sustaining your family and/or loved one’s quality of life.

Need to speak to an expert insurance adviser?

How to get a quote for family life insurance

Having children or partners who depend on your income can be a major responsibility.

At Cavendish Online, we understand the importance of getting life cover arranged quickly. With our online process you could have life cover arranged in as little as 30 minutes. Plus, it removes any hassle and makes getting life insurance nice and easy. That way, you can have peace of mind, knowing your loved ones are financially protected should the worst happen.

We offer 3 routes for getting a quote for family life insurance:

Route 1 - Quote & apply online

Route 1 is the fastest and most cost-efficient way to buy life insurance online. Our Quote and Apply process takes less than 15 minutes, and you could be covered within 30 minutes. The whole process is managed by you, so you can make all the decisions that are important to you.

Select this route if you:

Route 2 - Quote & apply with guidance

Route 2 is a great option for those who need an experienced professional to guide them through their life insurance quote. This way, you have everything you need to make an informed decision.

Select this route if you:

  • Need help from an expert to select the best policy
  • Are generally in good health or have minor health issues

Route 3 - Get Advice

Route 3 is the option for those who would like an adviser to recommend the right life insurance policy for them. Our team of experienced advisers are here to help you find the most suitable and affordable policy that suits your needs.

Select this route if you:

  • Would like an adviser to recommend a policy
  • Currently have or previously have had a medical condition/s
  • Are employed in a hazardous occupation or have a dangerous hobby

No matter what route you decide to go down, our team is here to help. Please don’t hesitate to contact us if you need any additional advice or support.

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