Life insurance is an unusual type of purchase. You make a commitment to pay out every month on something that you have no prospect of seeing the benefits of.
But there are some very good reasons to make sure you have the cover you need – and to arrange it as soon as you can.
Buy early and save
If you are in your early 20s, with no responsibilities, life insurance might not be your main priority. However, the lower costs of life insurance for young people in good health might make it worth considering.
Policies can run for decades. Having cover in place already rather than waiting until you’re older and possibly in less good health could mean substantial savings.
Many people get cover when they take out their first mortgage. Coming to independent financial experts like Continuum is likely to provide it at rather less than your mortgage broker will arrange.
But paying off a mortgage is just one of the reasons for taking out life assurance.
Protecting your family
Your priorities change when you have a partner, and even more so when a family come along. Then having the cover in place to pay off the mortgage is essential for your peace of mind. But it will be just one of your new priorities.
You will want cover to provide an income if you were no longer around to provide it yourself.
Ideally, the face amount of an insurance policy paid to the beneficiary should be enough to replace the income you would have earned, and let your family continue their lifestyle.
Providing that high level of cover may be difficult, especially when there are plenty of other demands on your budget. Again, it is important to get expert help to get the best value cover for the premiums you can afford, and at Continuum we will be pleased to help.
It’s not just you
You and your spouse may both be wage earners, but whether or not you both work, you both need cover. It is easy to imagine that a full-time parent does not need cover – but this can be a costly mistake. Childcare is expensive, if you had to pay someone to pick up children, drop them off at school – and look after them until you came home – you would soon see how the hidden costs add up.
You can arrange joint cover for yourself and your partner, which might help keep costs down while providing the protection you need.
Getting the best arrangement for joint cover is a job for an expert. At Continuum we can help – and discuss extra protection, such as an income protection to replace your earnings if illness means you are unable to work long-term or cover which pays out a lump sum if you’re diagnosed with a critical illness.
As time goes by
Once the children have left home and the mortgage paid off, you may feel the need for life insurance is over. Indeed, some of the reasons for having cover may no longer affect you, but others take their place.
You may want to arrange financial security for your surviving spouse. You may also want to ensure that your loved ones are the beneficiaries of your estate rather than the taxman. An example could be a whole of life plan written in trust, which when you die the proceeds of the plan are paid to the trust and therefore does not form part of your estate. The proceeds may be used to mitigate potential Inheritance Tax Liabilities.
A life insurance solution designed for you.
These are just some reasons for having life insurance.
Getting the cover, you need, and getting it at the lowest possible price can be a great deal easier if you have an expert to call on. At Continuum, we have the expertise you need.
To find out how we can assist you please contact us today.
The information contained in this article is based on the opinion of Continuum and does not constitute financial advice or a recommendation to suitable investment strategy, you should seek independent financial advice before embarking on any course of action.
The Financial Conduct Authority does not regulate taxation and trust advice.
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