{"id":2054,"date":"2017-09-04T07:48:24","date_gmt":"2017-09-04T07:48:24","guid":{"rendered":"http:\/\/www.newsfin.co.uk\/news\/?p=2054"},"modified":"2017-09-04T07:48:24","modified_gmt":"2017-09-04T07:48:24","slug":"life-insurance","status":"publish","type":"post","link":"https:\/\/teessidefinancial.com\/news\/life-insurance\/","title":{"rendered":"Life insurance"},"content":{"rendered":"<h3>Cover for you and your loved ones<\/h3>\n<h5>It\u2019s understandable that we would rather not think of the time when we\u2019re no longer around. However, it\u2019s important to protect the things that really matter \u2013 like our loved ones, home and lifestyle \u2013 in case the unexpected happens.<\/h5>\n<p><!--more--><\/p>\n<h2>Financial safety net<\/h2>\n<p>We insure our cars, homes and even our mobile phones \u2013 so it goes without saying that we should also be insured for our full replacement value to ensure that our loved ones are financially catered for in the event of our premature death. Life insurance provides a safety net for your family and loved ones if you die, helping them cope financially during an otherwise difficult time.<\/p>\n<p>We never know what life has in store for us, so it\u2019s important to get the right life insurance policy. A good place to start is asking yourself three questions: what do I need to protect? How much cover do I need? How long will I need cover for? This sum must take living costs into account, as well as any outstanding liabilities, such as a mortgage.<\/p>\n<h2>Other living expenses<\/h2>\n<p>It may be the case that not everyone needs life insurance (also known as \u2018life cover\u2019 and \u2018death cover\u2019). However, if your spouse and children, partner, or other relatives depend on your income to cover the mortgage or other living expenses, then the answer is \u2018yes\u2019.<br \/>\nLife insurance makes sure they\u2019re taken care of financially if you die. So whether you\u2019re looking to provide a financial safety net for your loved ones, moving house or a first-time buyer looking to arrange your mortgage life insurance<br \/>\n\u2013 or simply wanting to add some cover to what you\u2019ve already got \u2013 you\u2019ll want to make sure you choose the right type of cover. That\u2019s why obtaining the right advice and knowing which products to choose\u00a0\u2013 including the most suitable sum assured, premium, terms and payment provisions\u00a0\u2013 is essential.<\/p>\n<h2>Seriously under-insured<\/h2>\n<p>The appropriate level of life insurance will enable your dependants to cope financially in the event of your premature death. When you take out life insurance, you set the amount you want the policy to pay out should you die \u2013 this is called the \u2018sum assured\u2019. Even if you consider that currently you have sufficient life assurance, you\u2019ll probably need more later on if your circumstances change. If you don\u2019t update your policy as key events happen throughout your life, you may risk being seriously under-insured.<\/p>\n<h2>Own personal circumstances<\/h2>\n<p>As you reach different stages in your life, the need for protection will inevitably change. How much life insurance you need really depends on your circumstances, for example, whether you\u2019ve got a mortgage,\u00a0you\u2019re single\u00a0or you have children. Before you\u00a0compare life insurance, it\u2019s worth bearing in mind that the amount of cover you need will very much depend on your own personal circumstances, such as the needs of your family and dependants.<\/p>\n<h2>Think about why you might need cover<\/h2>\n<ul>\n<li>What would happen if you died or were\u00a0ill for a long time?<\/li>\n<li>Who are your financial dependants: your husband or wife, registered civil partner, children, brother, sister,<br \/>\nor parents?<\/li>\n<li>What kind of financial support does your family have now?<\/li>\n<li>What kind of financial support will your family need in the future?<\/li>\n<li>What kind of costs will need to be covered such as household bills, living expenses, mortgage payments, education costs, debts or loans, or funeral costs?<\/li>\n<\/ul>\n<p>There is no one-size-fits-all solution, and the amount of cover \u2013 as well as how long it lasts for \u2013 will vary from person to person.<\/p>\n<p><strong>These are some events when you should consider reviewing your life insurance requirements:<\/strong><\/p>\n<ul>\n<li>Buying your first home with a partner<\/li>\n<li>Covering loans<\/li>\n<li>Getting married or entering into a registered civil partnership<\/li>\n<li>Starting a family<\/li>\n<li>Becoming a stay-at-home parent<\/li>\n<li>Having more children<\/li>\n<li>Moving to a bigger property<\/li>\n<li>Salary increases<\/li>\n<li>Changing your job<\/li>\n<li>Reaching retirement<\/li>\n<li>Relying on someone else to support you<\/li>\n<li>Personal guarantee for business loans<\/li>\n<\/ul>\n<h2>Individual lifestyle factors determine the cost<\/h2>\n<p>The price you pay for a life insurance policy depends on a number of things. These include the amount of money you want to cover and the length of the policy, but also your age, your health, your lifestyle, and whether you smoke.<\/p>\n<h2>Replacing at least some of your income<\/h2>\n<p>If you have a spouse, partner or children, you should have sufficient protection to pay off your mortgage and any other liabilities. After that, you may need life insurance to replace at least some of your income. How much money a family needs will vary from household to household so, ultimately, it\u2019s up to you to decide how much money you would like to leave your family that would enable them to maintain their current standard of living.<\/p>\n<h2>Two basic life insurance types<\/h2>\n<p>There are two basic types of life insurance, \u2018term life\u2019 and \u2018whole-of-life\u2019, but within those categories there are different variations.<\/p>\n<p>The cheapest, simplest form of life insurance is term life insurance. It is straightforward protection, there is no investment element, and it pays out a lump sum if you die within a specified period. There are several types of term insurance.<\/p>\n<p>The other type of protection available is a whole-of-life insurance policy, designed to provide you with cover throughout your entire lifetime. The policy only pays out once the policyholder dies, providing the policyholder\u2019s dependants with a lump sum, usually tax-free. Depending on the individual policy, policyholders may have to continue contributing right up until they die, or they may be able to stop paying in once they reach a stated age, even though the cover continues until they die.<\/p>\n<h2>Remove the burden of any debts<\/h2>\n<p>Generally speaking, the amount of life insurance you may need should provide a lump sum that is sufficient to remove the burden of any debts and, ideally, leave enough over to invest in order to provide an income to support your dependants for the required period of time.<\/p>\n<p>The first consideration is to clarify what you want the life insurance to protect. If you simply want to cover your mortgage, then an amount equal to the outstanding mortgage debt can achieve that.<\/p>\n<p><strong>To prevent your family from being financially disadvantaged by your premature death and to provide enough financial support to maintain their current lifestyle, there are a few more variables you should consider: <\/strong><\/p>\n<ul>\n<li>What are your family expenses and how would they change if you died?<\/li>\n<li>How much would the family expenditure increase on requirements such as childcare if you were to die?<\/li>\n<li>How much would your family income drop if you were to die?<\/li>\n<li>How much cover do you receive from your employer or company pension scheme, and for how long?<\/li>\n<li>What existing policies do you have already, and how far do they go to meeting your needs?<\/li>\n<li>How long would your existing savings last?<\/li>\n<li>What state benefits are there that could provide extra support to meet your family\u2019s needs?<\/li>\n<li>How would the return of inflation to the economy affect the amount of your cover over time?<\/li>\n<\/ul>\n<p>IF THE PLAN HAS NO INVESTMENT ELEMENT, IT WILL HAVE NO CASH IN VALUE AT ANY TIME AND WILL CEASE AT THE END OF THE TERM. IF PREMIUMS ARE NOT MAINTAINED, THEN COVER WILL LAPSE.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Cover for you and your loved ones It\u2019s understandable that we would rather not think of the time when we\u2019re no longer around. However, it\u2019s important to protect the things that really matter \u2013 like our loved ones, home and lifestyle \u2013 in case the unexpected happens.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"_links":{"self":[{"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/posts\/2054"}],"collection":[{"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/comments?post=2054"}],"version-history":[{"count":0,"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/posts\/2054\/revisions"}],"wp:attachment":[{"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/media?parent=2054"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/categories?post=2054"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/teessidefinancial.com\/news\/wp-json\/wp\/v2\/tags?post=2054"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}