Do I Need Life Insurance?

There are no hard and fast rules as to whether you require life insurance, however taking a quick look at your current lifestyle and situation can usually reveal the answer.
life insurance is an important consideration for anyone who has dependants likely to survive them or outstanding financial commitments.

Below we have outlined a series of ‘life events’ which may well justify taking out some form of life insurance protection.

Taking Out a Mortgage

For most people a mortgage is the biggest financial commitment they will ever take on. As such, ensuring the mortgage is repaid should any adverse occurrences take place is of top priority.

You should consider protecting your mortgage repayments in the event of your death with life insurance but also in the event of illness with Critical Illness Cover. Critical illness cover will provide a monthly ‘income’ which can be used to meet the mortgage commitment in the event of serious illness or injury.

When you remortgage your mortgage exposure and term is likely to change, as such you should check your life insurance provides sufficient protection and top it up where necessary. This is essential when taking on additional borrowings.

A New Arrival

Life insurance should be considered when you have a new arrival to your family such as an adoption or birth as your list of dependants has grown! Until your child reaches 16 years old, you will be financially responsible for them and in most cases considerably longer if they take further education for example.

You should ensure your life assurance policy not only covers any outstanding burden of debts but also provides your child with a good standard of living.

A Change in Employment

When you change Jobs, you should check your life insurance protections are still satisfactory as your new employment may not offer the same benefits as your previous job. Conversely, you could have received new benefits which allow you to reduce your personal outgoings.

If you become self employed you will no longer receive any employee benefits. It is therefore essential for all self employed people to ensure they have enough life insurance protection.

Whilst not specific to a change in employment, Payment Protection insurance and Critical Illness insurance should be considered to ensure you can meet your financial commitments should you fall ill or become redundant.

We recommend you review what you will receive in the event of your death or illness and fill any gaps in cover that have arisen due to your change in employment.

Getting married

Getting married, life insurance wise, is similar to having a child or adopting; when you get married you are effectively adding another dependant to your income. It is therefore important to ensure your life insurance provides enough cover in light of your new dependant.

Whilst your partner may not be dependant upon you it is conceivable that they may become dependant upon you and as such your life insurance should cover for this.
Furthermore if you have children with your partner the life assurance requirements are compounded beyond the considerations for a marriage and children separately; caring for the child may make your partner unable to remain in employment and further increase the deficit between income and outgoings.

I’m getting divorced