Life insurance is one of those things that everyone admits we need to have, but no one wants to think about it. Why would you? After all you are putting in place arrangements should the worst happen to you, no one wants to think about that.
That said, as much as we don’t want to it is important that we do think about life insurance. It could make a huge amount of difference to the people you leave behind. Some would even consider it to be irresponsible to not have life insurance, especially if you have a family.
So why do you need life insurance, keep reading to find out.
- Protect your loved ones
- Your peace of mind
- Protect your assets
- High risk occupation or hobby
Protect your loved ones
Do you have a partner or spouse, or even any children? Having life insurance could protect them from any potential financial hardship should the worse happen to you. You could get insurance that pays a regular income or a single lump sum. This money could help pay for any debt, college/university or the mortgage on your home.
Especially, if you have a young family or a relatively new mortgage, should you die your family will have a lot of long term expenses they will need to cover. Having life insurance that could cover all of those expenses will ensure that your family are in the best possible position financially. The last thing you will want is to worry about money at such a horrible time.
Your peace of mind
No one wants to think about it, but you need to. You don’t know when you will die, no one does, that said if you were to prepare properly for the eventually when it comes to it you won’t need to worry about your family. While no amount of money can bring back a loved one, nor dull the pain of losing one, it can take away a lot of stress of every day life.
As you get older, you will more and more come to terms with your own mortality. If you sit down with your partner or spouse and plan out what would happen should the worst happen, you will gain a peace of mind that everyone will be cared for. With funeral costs only going up life insurance could ensure that your family will not be burdened by the harsh costs of ensuring you have a proper send off.
Protect your assets
Having life insurance is an important step to ensuring that you protect the assets that would be past on to your next of kin. If you are getting married or buying a house it is really important that you consider life insurance. Should you die you partner or spouse would still be liable to pay off the mortgage, could you afford to pay your mortgage on your own? Decreasing life insurance would ensure that your mortgage would be paid off in full. If you have an interest only insurance then you might want to consider level-term insurance.
When you get married it is highly probably that you and your partner will be joining your assets. Life insurance will help give you both peace of mind knowing that your assets are protected. Additionally, when you die your next of kin may be liable to pay inheritance taxes. If they can’t afford to pay them the only option the would have is to sell the assets you have left them. Life insurance could ensure that they do not have to face this dilemma.
High risk occupation or hobby
Some jobs or hobbies are more risky than others. A firefighter, police officer or solider is statistically at a greater risk of harm than someone who has an office job. Some jobs may even suggest or require you to take out life insurance due to the risks associated with the job. One thing to note, insurance companies may require that you pay a higher life insurance premium due to increased risk.
If you have hobbies such as scuba diving, rock climbing or skydiving it may be worth looking into insurance, you never know when something will go wrong. You may find that clubs or membership bodies strongly recommend or even require you to take insurance for their own insurance purposes.
To conclude, it is highly recommended that you look into getting life insurance. A common argument made against getting life insurance is the cost of premiums. These can be very affordable and you could get a really good deal by shopping around. If you go on a price comparison site you will be able to see lots of quotes from a range of insurers. If you do find a good quote, it might be worth going direct to the company rather than through the comparison site. Many companies will offer incentives such as cash back or shopping vouchers.
An example of a quote is to cover a £145,000 mortgage. Assuming you have put down a 10% deposit you would need cover of £130,500 depreciating over the term of the mortgage. Legal and General gave a quote of £7.64 per month for the total cover depreciating over 30 years. They also offered a £100 M&S or Amazon voucher after 6 months of payments, but this is not available if you go through an advisor or comparison site.
None of the content in this article should be considered financial advice, I am not a financial adviser and you should always do your own research prior to investing. These are my opinions only.