Protect your loved ones with Life Insurance

"But nothing in this world is said to be certain, except death and taxes" Benjamin Franklin.

Unfortunately, death can come to us at any time, and for many of us, we want to ensure our loved ones financial needs are met.

Life insurance is an insurance policy that pays out in the event of the policyholder passing away. Its normally taken to cover mortgages, funeral expenses or a lump sum to be given to loved ones.

If you have dependents, particularly young children or a family then a life insurance policy is something that would be recommended. It can cover any financial commitments that you have such as a mortgage or provide lump sum which could give your loved one’s financial security

There are 5 “terms” which are the most popular and these are:

Decreasing term insurance policy

Normally taken out with a repayment mortgage to cover this cost. As the amount owed on the property reduces over time so will the pay-out, this is the cheapest option to take out.

Level-term life insurance policy

This policy will pay a fixed amount of money at the time of death (as long as the policy is still active). You would select the amount that you want the lump sum to be and this would remain fixed over the term of the policy. This is normally more expensive than a decreasing term insurance policy

Joint life insurance policy

As the name suggests, it covers couples and will pay out once when the first partner passes away within the term of the policy

Whole of life insurance policy

Will guarantee to pay-out upon death, even if that comes at a ripe old age of 100 plus.

Over 50’s insurance policy

This policy is designed for people who are aged over 50. Its pay-out is smaller as it’s designed to cover funeral expenses so the policy value is typically between £1,000 and £25,000

This will depend on your financial commitments and whether or not you want to leave a lump sum after these commitments have been met. As a minimum you should cover your mortgage and funeral costs and then depending on your budget add a cash lump sum too.

This is very much dependent on the circumstances surrounding your situation and what you would want to leave your loved ones. There is also a critical illness add-ons you could select, this will pay-out if a critical illness is diagnosed by medical professionals to help with financial matters during your treatment

The cost of the policy is based on a number of factors, are you smoking, your age, previous medical conditions, current health, the term type (Level, Decreasing, Joint, etc..), the amount needed to be covered, the length of the policy and also if critical illness is added.

It’s possible to get a policy from the age of 18. Most people think of getting a policy if they have a mortgage and / or dependents. Premiums prices increase as age increases.

Certain financial institutions will insist upon it. However, it’s considered a good judgment call to take one out, as death could come at any time, and without life insurance in place, your loved ones may struggle.

It is important to review the level cover periodically to ensure that the current policy meets all of your needs, you can take out a second policy, add to an existing one or cancel the existing one and take a brand new one. We would recommend that you review the policy cover if there is a major circumstantial change such as moving home (to cover the new mortgage if this has increased), getting married or having a child (to leave a lump sum).

It’s a tax-efficient measure where the money is paid out into a trust, and not considered part of the estate when relevant bodies calculate inheritance tax.

Yes, but it could cost more, as it’s viewed as a higher risk. The most common pre-existing conditions which most companies cover, but not limited to are; asthma, diabetes and obesity.

You must make sure to declare ailments when taking out the life insurance cover as a failure to be transparent could void it.

You can still take out a traditional life insurance policy, but the prices will be higher than a 30 year taking out the policy, and there are upper age limits for when the policy will expire, typically this is between 70 and 75 or there is over 50s plan, where the monthly price is a lot lower but the pay-out is also a lot smaller and commonly taken out to cover funeral expenses. However, as it is a lump sum, the beneficiaries are able to spend it any way they see fit

If you missed the payment, contact your life insurance provider and explain why it was missed and seek to make alternative payments.

Certain policies will allow you to make a claim if you’ve been diagnosed with a terminal illness and having less than 12 months to live