LIFE INSURANCE- WHAT IT IS AND WHY YOU NEED IT

It’s said that the best thing you can do for your family is not to make them feel the loss even when you’re no more. Losing a loved one can alter family members’ lives like never before. They lose their loved one’s moral and financial support. Yet, you can ensure that your family gets financial support by choosing a life insurance product. Almost every UK citizen is getting his or her life covered to protect against unforeseen events. It’s wise to get it early on as life cannot be predicted. It’s never too late to think about our family’s future.

 

WHAT IS IT?

Life insurance acts as a financial support for your family after you die. Most often, family members are dependent on a single breadwinner and are devastated when that person is no more. If your children or partner are dependent on you for their living expenses, you should definitely buy a product that covers your life.

There are many insurance companies like Aviva which is well known all over Europe for their life insurance policy. It is beneficial for your children and wife as it pays them a lump sum or regular payments if you die.

You should check whether your employee package includes ‘death in service’ benefits, in which case you might need just a top-up on the already existing insurance. If you’re young and healthy, life cover provides good value for money. However, it only covers death and not unemployment due to illness or disability. If you have an existing medical condition before you apply for a cover, it may come only at a high cost.

 

DO I NEED IT?

Getting a life cover is always a good thing to do if your partner, children or relatives depend on your income to cover mortgage and other living expenses. Even after you die, your partner has to live their life, your children have to get a good education and a well-paying job. Life insurance provides for your family in the event of your death, so that they are not affected financially. The amount of money paid out will depend on the amount of total premium you will be paying. You can either opt for a full payment in lump sum or monthly payments that cover mortgage or rent. You may not need it if you’re single, your partner earns enough for a living or you’re eligible for state benefits.

 

WHAT ARE ITS TYPES?

They are of two main types:

• Term insurance policy: They run for a fixed period, say 5, 10 or 25 years. They pay out only if you die during the term of your insurance policy. There’s no lump sum coming on the maturity of the policy.
• Whole-of-life policy: They will pay out whenever you die, as long as you are keeping up with the premium payments.

 

HOW MUCH WILL IT COST?

 How much a death cover will cost you may vary as per your level of protection. There are low as well as high premium options, so it’s a good idea to shop around. The price you pay depends on your

• Age
• Health
• Lifestyle
• Whether you’re a smoker or non-smoker
• Length of your policy
• The amount you want to cover

 

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